Wall Street Analysts Are Bullish on This Artificial Intelligence (AI) Stock -- Here's What You Need to Know
When investors think of AI stocks, Upstart (NASDAQ: UPST) may not be the first that comes to mind. However, the company has a strong claim to the title. It's harnessed the power of machine learning and data science for a new credit platform that has been more accurate at assessing creditworthiness than conventional FICO scores, according to Upstart.As a stock, Upstart has been one of the more volatile names in the market as the business has considerable potential, but it has also struggled to turn a profit in recent years. Plus, any credit business is inherently risky, since loans could go bad if the economy sours, or Upstart's credit partners could stop buying its loans, eliminating the funding it needs to operate.Upstart's latest earnings report offered more reasons to be optimistic. Its transaction volume jumped 102% in the first quarter to 240,706 with originations up 89% to $2.1 billion. Meanwhile, its conversion rate improved from 14% to 19.1% because of an update in its AI model that makes as many as 1 million predictions per applicant to determine whether to lend to the applicant and what interest rate to charge.Continue reading
When investors think of AI stocks, Upstart (NASDAQ: UPST) may not be the first that comes to mind. However, the company has a strong claim to the title. It's harnessed the power of machine learning and data science for a new credit platform that has been more accurate at assessing creditworthiness than conventional FICO scores, according to Upstart.
As a stock, Upstart has been one of the more volatile names in the market as the business has considerable potential, but it has also struggled to turn a profit in recent years. Plus, any credit business is inherently risky, since loans could go bad if the economy sours, or Upstart's credit partners could stop buying its loans, eliminating the funding it needs to operate.
Upstart's latest earnings report offered more reasons to be optimistic. Its transaction volume jumped 102% in the first quarter to 240,706 with originations up 89% to $2.1 billion. Meanwhile, its conversion rate improved from 14% to 19.1% because of an update in its AI model that makes as many as 1 million predictions per applicant to determine whether to lend to the applicant and what interest rate to charge.
