Upstart Holdings, Inc. (UPST) shares are on the rise today, following the Federal Reserve’s decision to cut interest rates by 50 basis points (bps) on Wednesday. This move, the first rate cut in over four years, has sparked a broader market rally, with investors digesting the implications of the Fed’s actions.
The rate cut, which brings the federal funds rate down to a range of 4.75% to 5%, will reduce interest rates for consumers. This could benefit Upstart’s business, as lower rates may encourage more borrowers to seek out automotive and personal loans, key segments for Upstart’s operations.
Earlier this week, Upstart announced a private offering of $300 million convertible senior notes due in 2029, which was later upsized to $375 million. This move suggests the company is actively seeking capital to fuel its growth initiatives.
However, while the Fed’s rate cut might provide a short-term boost to Upstart’s stock, analysts are still cautious about its long-term prospects. The average 12-month price target from Wall Street analysts for UPST is $28.14, with a high target of $35 and a low target of $10. Of the analysts covering Upstart, one has a positive rating, three have neutral ratings, and three have negative ratings.
It’s important to remember that stock markets are volatile, and past performance is not indicative of future results. While Upstart’s stock has seen a positive year-to-date return of 2.58%, the average analyst price target suggests potential for further downside ahead.
For a comprehensive overview of Upstart Holdings, Inc. and its operations, visit their website. Investors seeking advanced market data and analysis might find Benzinga Pro a valuable tool.
As of this writing, Upstart shares are up 4.93% at $40.20.
