Upstart Pop Is No Accident
If you are an Upstart shareholder you should be grinning ear to ear — unless they sold early, in which case they’re probably staring at the ceiling rethinking their life choices. For a few months I’ve informed you: the main number that matters for Upstart’s near-term trajectory is the Upstart Macro Index (UMI). Not revenue, not loan volume,not earnings (which were great) not management’s tone during earnings calls — UMI. And, as I thought, the UMI has kept drifting lower. October’s reading is 1.48, down 3.9% month-over-month. That decline, my friends, is exactly why the stock ripped higher Friday. When risk conditions ease, Upstart’s does loosen up, approvals increase, and the market suddenly remembers this company isn’t dead — it was just suffocating under a macro environment that dials back approvals.
Remember last quarter when Upstart “missed revenue expectations”? The pearl-clutchers panicked, but I told you the entire miss was because the UMI had increased, (lower that street expected revenue) forcing Upstart to be more selective with loans. That wasn’t a business problem — it was a macro constraint. And now that the UMI has resumed its descent, well… look at the chart yourself. (Yes, this is the current just updated chart). Those in the know watch this closely!
The rally wasn’t magic. It wasn’t short-squeeze pixie dust per say but it does have the short players second guessing further shorts as they covered Friday.. It could be back to risk on buying again since conditions seem to be improving exactly as I said they would. Interest rates softening + UMI dropping = Upstart breathing pure oxygen. The largest risk I believe going forward I see is a possible rise in unemployment (this has the potential to stall the decline in the UMI) — that macro factor has the potential to push the UMI higher again and choke loan approvals. (mass lay offs to date have not materialized) But unless job losses spike, the setup heading into 2026 looks eerily similar to the setup before Upstart ran over 250% in 2024 when i was ahead of wall street.. And yes — I was early on then. It was my number 1 pick in 2024. I always show up at the party early. Those that show up late..get the left overs.
So here we are again. UMI falling. Rates easing. Market waking up. And Upstart returning to my “Top Picks for 2026” list, right where it belongs. People can pretend this is coincidence, but the data speaks for itself — loudly the smart money is in the know.. I told you what would happen in 2024, and I’m telling you again now. Don’t say you weren’t warned.