Goldman Sachs on Friday revised its recommendation on Upstart Holdings Inc. (NASDAQ: UPST), raising the rating from Sell to Neutral and establishing a price target of $35.00. The firm explained that the shares have weakened enough that the balance of upside and downside risk appears more even for investors.
The bank’s earlier Sell view was driven by worries that new product introductions could lead to compression in take rates and contribution margins, risks Goldman believed the market had not fully priced in. Goldman also cited expectations for peak cycle dynamics in consumer lending around the summer of 2025 as part of the rationale behind its prior cautious stance.
Following those concerns, Upstart recorded somewhat slower-than-expected volumes during the second half of 2025 and issued guidance reflecting the take-rate and contribution margin compression that Goldman had warned about. Goldman Sachs said these developments are now better understood by market participants, and combined with the stock’s relative underperformance, the firm adjusted its recommendation to Neutral.
In corporate results, Upstart released fourth-quarter 2025 financials that produced mixed signals. Reported earnings per share were $0.17, below the consensus estimate of $0.46, representing a 63.04% negative surprise. Revenue, however, came in at $296 million, beating the forecasted $288.45 million for a 2.64% upside surprise.
Adding to the momentum of analyst activity, Citizens moved in the opposite direction on Upstart, lowering its rating from Market Perform to Market Underperform and assigning a $20.00 price target. Citizens cited valuation considerations after gaining what it described as greater clarity on Upstart’s earnings trajectory under the company’s new medium-term guidance.
Taken together, the analyst actions and the company’s latest quarter highlight a period of recalibration for Upstart, with market participants and research shops reassessing the implications of weaker volume trends and anticipated margin pressures for the firm’s near-term performance.
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