Compass Point moved Upstart Holdings Inc (NASDAQ: UPST) off a Sell rating and to Neutral on Tuesday, while raising its price target to $30 from $20. That new target sits close to Upstart’s then-trading price of $30.68. According to InvestingPro data, the company's share price is trading near a 52-week low of $29.61 after a 62.78% decline over the past year.
The upgrade is notable because it marks the first time Compass Point has shifted away from a Sell recommendation since it began covering Upstart in March 2023. The firm said its $30 price objective is grounded in a valuation equal to two times the company’s estimated tangible book value for the year 2028, which Compass Point places at $15.21. InvestingPro’s Fair Value assessment is consistent with the view that Upstart may be undervalued at current market levels.
Compass Point said the change in rating follows Upstart’s fourth-quarter 2025 financial disclosure and the company’s own multi-year guidance. Management provided a 2025-2028 revenue compound annual growth rate outlook of about 35% and set a terminal adjusted EBITDA margin target of roughly 25% by the terminal year. Those targets, together with recent results, form the basis for Compass Point’s expectation that investors will have a clearer reference point for valuing the stock around fiscal year 2028.
Upstart reported strong recent growth on several measures. Revenue for the trailing twelve months rose 58.87% to $1.08 billion, and EBITDA reached $99.13 million. In the company’s fourth-quarter 2025 results, revenue beat the consensus estimate while earnings per share missed expectations: the company posted EPS of $0.17 versus the forecasted $0.46, a negative surprise of 63.04%. Revenue for the quarter came in at $296.0 million versus an anticipated $288.45 million, a positive surprise of 2.64%.
Compass Point indicated that the presence of clear multi-year targets should allow the market to transition from historical trading patterns to valuation debates centered on the company’s ability to deliver on its fiscal year 2028 outlook. The analyst firm suggested investors may be able to apply a reasonable multiple to Upstart shares if management executes on the guidance.
Analyst reaction beyond Compass Point remains mixed. Goldman Sachs also upgraded Upstart from Sell to Neutral and set a higher price target of $35.00, reflecting a more balanced assessment of upside and downside. By contrast, Citizens moved in the opposite direction, downgrading the stock from Market Perform to Market Underperform and lowering its price target to $20.00. Citizens cited valuation concerns and referenced the company’s three-year medium-term guidance as part of its rationale.
These differing analyst conclusions underscore a split view among sell-side firms about how to weigh Upstart’s top-line momentum, margin targets and current market valuation. With the company trading near recent lows yet presenting aggressive growth and margin aspirations for 2028, the debate over an appropriate valuation multiple appears likely to continue until there is clearer evidence of execution against the multi-year plan.