Upstart initiated with a Hold at Needham

Needham initiated coverage of Upstart with a Hold rating and no price target. The analyst believes the long-term growth potential for Upstart is significant. However, the company has been pressured by a more difficult funding environment in recent quarters which is causing Needham model to project a 37% decline in revenue in fiscal 2023, the analyst tells investors in a research note. In addition, the firm believes there are other factors, like elevated amount of loans held on balance sheet, high stock-based compensation, and a deeply out of the money convertible bond, that it expects to keep the shares range-bound over the next 12 months.