Upstart Holdings, Inc., together with its subsidiaries, operates a cloud-based artificial intelligence (AI) lending platform in the United States. Its platform includes personal loans, automotive retail and refinance loans, home equity lines of credit, and small dollar loans that connects consumer demand for loans to its to bank and credit unions. Upstart Holdings, Inc. was founded in 2012 and is headquartered in San Mateo, California.

Upstart Holdings, Inc.

Looking at options trading activity among components of the Russell 3000 index, there is noteworthy activity today in Upstart Holdings Inc (Symbol: UPST), where a total volume of 31,229 contracts has been traded thus far today, a contract volume which is representative of approximately 3.1 million underlying shares (given that every 1 contract represents 100 underlying shares). That number works out to 55.5% of UPST's average daily trading volume over the past month, of 5.6 million shares. Particularly high volume was seen for the $85 strike call option expiring August 01, 2025, with 7,873 contracts trading so far today, representing approximately 787,300 underlying shares of UPST. Below is a chart showing UPST's trailing twelve month trading history, with the $85 strike highlighted in orange:
Snowflake Inc (Symbol: SNOW) saw options trading volume of 17,972 contracts, representing approximately 1.8 million underlying shares or approximately 55% of SNOW's average daily trading volume over the past month, of 3.3 million shares. Especially high volume was seen for the $225 strike call option expiring August 01, 2025, with 2,229 contracts trading so far today, representing approximately 222,900 underlying shares of SNOW. Below is a chart showing SNOW's trailing twelve month trading history, with the $225 strike highlighted in orange:
And Qualcomm Inc (Symbol: QCOM) options are showing a volume of 40,432 contracts thus far today. That number of contracts represents approximately 4.0 million underlying shares, working out to a sizeable 54.2% of QCOM's average daily trading volume over the past month, of 7.5 million shares. Especially high volume was seen for the $140 strike put option expiring August 01, 2025, with 5,540 contracts trading so far today, representing approximately 554,000 underlying shares of QCOM. Below is a chart showing QCOM's trailing twelve month trading history, with the $140 strike highlighted in orange:
For the various different available expirations for UPST options, SNOW options, or QCOM options, visit StockOptionsChannel.com.
HOFV Split History
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Notable Monday Option Activity: UPST, SNOW, QCOM

In the rapidly evolving world of fintech, investors are constantly searching for companies with innovative models and sustainable growth potential. Two such players — PayPal PYPL and Upstart Holdings UPST — have emerged as notable disruptors, albeit in very different arenas.
PayPal, a pioneer in digital payments, is transforming into a full-spectrum commerce platform, while Upstart is shaking up the consumer lending space with its AI-driven credit underwriting. Yet, as 2025 unfolds, both companies face their share of opportunities and obstacles.
PayPal is down nearly 14% year to date amid competitive pressures, while Upstart has soared more than 20% in the same period, thanks to its rapid product diversification and technological edge. But the key question for investors is: Which fintech is better equipped to deliver long-term portfolio value amid rising macro uncertainty and sector-wide disruption?
Let’s weigh the pros and cons of each to find out which deserves a spot in your portfolio.
The Case for PayPal
PayPal’s stock underperformance so far in the year masks a deeper story of strategic reinvention. Despite stiff competition from peers, PayPal is pushing forward with a multi-pronged transformation. The company is transitioning from a transactional payment provider to a holistic commerce partner by consolidating its services into a single PayPal platform to harness the full potential of its two-sided network, supporting both consumers and merchants. Focusing on improving user experience, enhancing merchant relationships and expanding international capabilities are the key moves that could unlock long-term growth.
Encouragingly, core operating metrics have shown resilience. Transaction margin dollars rose 7% year over year in the first quarter of 2025, and Venmo revenues surged 20%, contributing 18% to total payment volume. Additionally, PayPal’s Buy Now, Pay Later (“BNPL”) segment continues to shine. Volumes rose more than 20% in the first quarter, and monthly active accounts increased 18% year over year. BNPL users spend 33% more and make 17% more transactions, on average, highlighting its effectiveness in driving consumer engagement.
International expansion is also underway, with NFC rollouts in Germany and the U.K. aiming to replicate U.S. omnichannel success. PayPal’s expanding partnerships with Coinbase, Amazon and Shopify are boosting its growth outlook. A deeper tie-up with Coinbase is also advancing the adoption of its PYUSD stablecoin.
However, all this innovation comes at a cost. Investments in platform modernization, product rollouts and global expansion are likely to pressure margins in the short term. It’s also under competitive strain from Visa, Mastercard, Apple Pay and others. Regulatory risks like potential tariffs or data access fees, such as JPMorgan’s fintech initiative, add uncertainty.
The Case for Upstart
Upstart has enjoyed an impressive run in 2025, well ahead of most of its peers in the digital lending space. At its core, Upstart differentiates itself by using artificial intelligence to disrupt credit underwriting, replacing traditional FICO-based assessments with models that factor in education, employment and broader financial behavior. Its AI systems enabled full automation of 92% of loans in the first quarter of 2025, while conversion rates rose from 14% to 19% year over year, underscoring both scalability and operational efficiency.
Moreover, Upstart is rapidly expanding beyond personal loans into auto refinancing, HELOCs and small-dollar loans. Auto originations jumped 42% sequentially, and HELOCs surged 52%, creating new revenue channels. Its marketplace model has diversified funding across banks, credit unions and private credit providers, now with more than 50% of volume backed by committed capital. With 32% of originations now from super-prime borrowers, credit quality is on an upswing.
Still, Upstart’s journey isn’t without headwinds. The expanding focus on super-prime borrowers lowers take rates due to heightened competition. Margins in newer products like HELOC and auto lending are expected to mature over time, with initial take rates being modest due to early-stage scaling. Macroeconomic uncertainty and trade tensions add to the company’s woes.
How Do Zacks Estimates Compare for PYPL & UPST?
The Zacks Consensus Estimate for PayPal’s 2025 sales and EPS implies a year-over-year increase of 2.9% and 9.5%, respectively. EPS estimates have been trending northward over the past month.
Image Source: Zacks Investment Research
Meanwhile, the consensus estimate for Upstart’s 2025 sales implies a year-over-year rise of 59.46%. EPS estimates have been trending northward over the past month.
Image Source: Zacks Investment Research
Valuation: PYPL vs. UPST
From a valuation perspective, we note that PayPal shares are trading cheap, as suggested by the Value Score of B. However, Upstart shares are currently overvalued, as implied by the Value Score of F.
In terms of forward 12-month Price/Sales (P/S), PYPL stock is trading at 2.1X, below its three-year median, while Upstart is currently trading at 6.03X, which is well ahead of its three-year median.
Image Source: Zacks Investment Research
Price Performance: PYPL vs. UPST
Over the past month, shares of UPST have outperformed PayPal and the S&P 500 composite.
Image Source: Zacks Investment Research
Conclusion
Both PayPal and Upstart bring unique strengths to the table. Upstart's AI-centric approach to lending has ignited rapid growth and innovation, carving out a niche in consumer credit, but it also comes with heightened risk and uncertainty. When it comes to portfolio inclusion in today’s uncertain environment, PayPal’s diversified growth drivers, strong execution and evolving partner ecosystem give it the edge.
While Upstart shows promise, PayPal anchors its fintech credentials on a mature, global payment infrastructure, an expanding product suite and a strong brand. Despite short-term challenges, PayPal's stability, scale, and strategic evolution make it a more balanced and reliable fintech pick for investors seeking resilient growth in their portfolios.
Even though both companies currently carry a Zacks Rank #3 (Hold) each, PYPL has a VGM Score of A, while UPST has a score of B, implying that PayPal is having a better hand at the moment. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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PYPL vs. UPST: Which Fintech Disruptor Is the Smarter Investment?

AI, Superman, and Solar's Kryptonite

Below is Validea's guru fundamental report for UPSTART HOLDINGS INC (UPST). Of the 22 guru strategies we follow, UPST rates highest using our Small-Cap Growth Investor model based on the published strategy of Motley Fool. This strategy looks for small cap growth stocks with solid fundamentals and strong price performance.
UPSTART HOLDINGS INC (UPST) is a mid-cap growth stock in the Consumer Financial Services industry. The rating using this strategy is 55% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
Detailed Analysis of UPSTART HOLDINGS INC
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

UPST Quantitative Stock Analysis

Comparing units outstanding versus one week ago at the coverage universe of ETFs at ETF Channel, the biggest inflow was seen in the YieldMax Ultra Option Income Strategy ETF (ULTY), which added 38,075,000 units, or a 32.6% increase week over week. Among the largest underlying components of ULTY, in morning trading today Upstart Holdings (UPST) is up about 0.8%, and Robinhood Markets (HOOD) is higher by about 1.9%.
And on a percentage change basis, the ETF with the biggest increase in inflows was the Themes Natural Monopoly ETF (CZAR), which added 20,000 units, for a 40.0% increase in outstanding units. Among the largest underlying components of CZAR, in morning trading today Intuit (INTU) is up about 0.1%, and Broadcom (AVGO) is lower by about 0.6%.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

ULTY, CZAR: Big ETF Inflows

Artificial intelligence (AI) has dominated the stock market since the launch of ChatGPT in late 2022. At that time, the S&P 500 was in a bear market following the post-pandemic hangover and a spike in inflation. But since then, the broad market index has jumped by more than 50%.
By now, investors are well aware of the top-performing AI stocks like Nvidia and Palantir, but there are other stocks that have more quietly been outperforming the market. Let's take a look at two of them.
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1. Upstart
Upstart (NASDAQ: UPST) was a big winner following its initial public offering (IPO) in December 2020 as the stock skyrocketed during the pandemic in 2021. However, in the bear market that followed, Upstart stock plunged 97% as rising interest rates crushed its lending business (the company operates as an AI-driven online lending platform).
The stock was largely forgotten by investors, but Upstart has made a number of improvements to its business by introducing a new, more advanced AI model that has improved its conversion rates, and moving further into large lending markets like the home and auto sectors. Along the way, it's quietly staged a comeback, and the stock has jumped 175% over the last year (at the time of this writing).
Upstart has more upside potential as the stock's market cap is just $6 billion, and it is trying to disrupt a massive market, competing with traditional FICO scores. According to Upstart, the company's AI-based lending model achieves significantly better results than the FICO score, and the business is growing rapidly with profitability improving.
In the first quarter, revenue was up 67% to $213 million on an 89% increase in originations to $2.1 billion. It also reported a 19.1% conversion rate, up from 14% in the quarter a year ago. On the bottom line, its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) came in at $43 million, up from a loss of $20 million in the quarter a year ago. The company also expects to be profitable on a generally accepted accounting principles (GAAP) basis this year.
Overall, Upstart still has a large growth opportunity in front of it as credit is a massive market. If it continues to execute, the stock should outperform over the coming years, and further technology improvements could drive an inflection point in the stock.
2. Lemonade
Another overlooked AI stock that is suddenly soaring is Lemonade (NYSE: LMND), the AI-based insurance company.
Like Upstart, Lemonade had a successful IPO during the pandemic and then plunged in 2022 due to ongoing losses, slowing growth, and shifting market sentiment.
However, Lemonade has now mounted a comeback on improving results and a new goal of reaching profitability by 2027. As a result, the stock is now up 160% over the last year. In particular, the stock soared last November after a strong earnings report and an Investor Day conference that pleased investors.
In its most recent earnings report, Lemonade reported an acceleration in force premium growth at 27% to $1.01 billion. Total customers rose 21% to 2.55 million. Its gross loss ratio over the last four quarters was steady at 73%, meaning 73% of its revenue went to paying claims.
Lemonade also shared in the Investor Day conference that it expects to be adjusted EBITDA profitable by 2026 and GAAP net income profitable by 2027.
Lemonade still has some challenges to overcome, and there's always the risk of a disaster like the California wildfires, which weighed on Q1 results, but management's efforts to streamline its business seem to finally be paying off.
At a market cap of $3 billion, the stock could easily double from here, especially if Lemonade executes on its plan to turn profitable.
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Jeremy Bowman has positions in Nvidia and Upstart. The Motley Fool has positions in and recommends Lemonade, Nvidia, Palantir Technologies, and Upstart. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

These Artificial Intelligence (AI) Stocks Are Quietly Outperforming the Market

Upstart Holdings, Inc. UPST has staged a notable rebound, buoyed by investor optimism around its AI-driven lending platform and strategic execution. The company continues to disrupt traditional credit models by leveraging machine learning to enhance consumer loan underwriting.
However, valuation concerns are emerging. Upstart currently holds a Value Score of F, signaling potential overvaluation. Its forward 12-month Price/Sales ratio stands at 5.23, significantly above the industry average of 3.86.
This valuation premium has led to some caution among investors. While the growth narrative remains compelling, questions are rising about whether the stock’s recent surge is fully justified.
Image Source: Zacks Investment Research
Upstart Holdings is reshaping credit underwriting with its proprietary AI model that goes beyond traditional FICO scores. By incorporating education, employment and financial behavior, it enables more precise borrower assessments. In the first quarter of 2025, 92% of loans on its platform were fully automated, boosting both efficiency and borrower satisfaction. Conversion rates rose from 14% to 19% year over year, reflecting the growing impact of its model enhancements.
The company is also diversifying aggressively. New verticals like auto loans, HELOCs and small-dollar credit are gaining traction, with robust growth in some segments. Partnerships with credit unions, like All In Credit Union, highlight Upstart’s appeal in traditional finance. The company’s focus on super-prime borrowers, now 32% of originations, helps secure low-cost funding and manage credit risk more effectively.
However, challenges remain. Elevated interest rates and a dip in contribution margins are notable. The growing super-prime borrower mix, while improving credit quality, also results in lower take rates due to intense competition. Moreover, margins in newer products like HELOC and auto lending are expected to mature over time, with initial take rates being modest due to early-stage scaling. Moreover, macroeconomic uncertainty and trade tensions add to the company’s woes.
This calls for a more measured approach at current levels. Much of the recent enthusiasm appears priced in, making it wise to consider waiting for a more attractive entry point. While the underlying fundamentals remain compelling, allowing the valuation to realign with the company’s long-term potential could present a more balanced risk-reward setup.
Are Other Fintechs Offering Better Value?
Block, Inc. XYZ is scaling a dynamic fintech ecosystem through Square and Cash App, offering end-to-end solutions across payments, commerce, lending and banking. With innovations like Cash App Afterpay and gains in Square’s gross profit, Block continues expanding despite macroeconomic headwinds. However, Block shares are also overvalued, as suggested by the Value Score of D. In terms of forward 12-month Price/Earnings (P/E), Block is trading at 22.57X compared with PayPal’s 13.74X.
PayPal PYPL is transforming into a full-spectrum commerce partner, unifying its platform to serve both consumers and merchants. Growth in branded checkout, Venmo, and BNPL is boosting user engagement, though near-term margin pressure persists amid global expansion and macro uncertainty. PayPal shares are trading cheap, as suggested by the Value Score of B. In terms of forward 12-month P/E, PYPL stock is trading at 13.74X compared with the Zacks Financial Transaction Services industry’s 22.48X.
Upstart’s Price Performance and Estimates
Shares of Upstart have climbed 37.8% quarter to date, outperforming both the broader industry and the S&P 500 Index.
Image Source: Zacks Investment Research
While the full-year 2025 consensus mark for EPS has been revised slightly downward over the past week, the same for 2026 has been adjusted above the prior projections. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)
Image Source: Zacks Investment Research
At present, Upstart carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Is Upstart Too Expensive Now? A Wait-and-See Approach May Help

Nvidia supplies the best data center chips for artificial intelligence (AI) development, and with a market capitalization of $3.6 trillion, it's now one of the largest companies in the world. There is still room for its stock to move higher, but investors who already own it might be looking for other AI names with growth potential.
C3.ai (NYSE: AI) developed a portfolio of over 130 ready-made applications to help businesses accelerate their adoption of AI. Upstart Holdings (NASDAQ: UPST), on the other hand, created an AI-powered lending algorithm that helps banks assess the creditworthiness of potential borrowers far more effectively than traditional methods.
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Both companies have rapidly growing businesses and enormous addressable markets, so here's why it might be a great idea for investors to add C3.ai and Upstart to their portfolios for the long term.
The case for C3.ai
Very few companies have the financial resources or the technical expertise to develop AI software from scratch, so they are turning to third-party vendors like C3.ai to meet their needs. C3.ai can deliver a custom AI application to a business customer in as little as three months from the initial project briefing, whether they operate in financial services, retail, manufacturing, oil and gas, or a host of other industries.
C3.ai also stepped into agentic AI recently. It developed a platform that allows businesses to create and deploy virtual assistants into their operations to analyze data, automate workflows, and even influence key decisions. The platform connects to over 200 third-party databases and software applications so businesses can tap into their most valuable data to extract the most out of their AI agents.
Salesforce CEO Mark Benioff says the market for "digital labor" -- or agents -- could be as large as $12 trillion in the future, so C3.ai might be on the cusp of the biggest financial opportunity in its history thanks to its agentic platform.
Businesses can access C3.ai's products through leading cloud providers like Amazon Web Services, Microsoft Azure, and Alphabet's Google Cloud. They can scale C3.ai's software using the computing capacity on offer from those cloud providers, so they don't have to bear the enormous cost of maintaining their own infrastructure.
C3.ai is building some serious momentum right now. The company generated a record $389.1 million in revenue during its fiscal 2025 (which ended on April 30), representing an increase of 25% compared to the prior year. That growth rate accelerated for the second straight year.
Shares of C3.ai are down 85% from their record high, which was set during the tech frenzy in 2020. The stock was unquestionably overvalued back then with its price-to-sales (P/S) ratio soaring to around 80, but it has since come down to a more reasonable level of 7.8. In fact, that's a 19% discount to its three-year average of 9.7 (which excludes the expensive 2021 period), so the stock might actually be undervalued now:
The combination of C3.ai's momentum, its sizable market opportunity in areas like agentic AI, and its valuation creates a compelling opportunity for investors.
The case for Upstart
Upstart thinks traditional human-led methods for assessing the creditworthiness of potential borrowers are outdated, partly because they center around Fair Isaac's FICO credit scoring system, which only considers a handful of metrics like a person's outstanding debts and their repayment history.
The company's AI algorithm analyzes over 2,500 data points for every applicant to gain a better understanding of their creditworthiness. In fact, it's currently so good that it approves twice as many loans at a much lower average interest rate compared to traditional assessment methods -- all while maintaining a comparable risk profile. Plus, 92% of Upstart's approvals are now fully automated, so applicants don't have to wait around for lengthy human assessment processes.
Upstart earns a fee each time its platform originates a loan on behalf of its bank partners. The company specializes in unsecured personal loans, but it has a growing presence in car loans and home equity lines of credit (HELOCs). There is still plenty of room for expansion into other segments like business loans, industrial loans, and credit cards over the long term.
CEO Dave Girouard says $25 trillion worth of loans are originated worldwide each year across all segments, creating $1 trillion in fee revenue. He thinks all credit assessment processes will be handled by AI within the next decade, so Upstart is in a great position to capitalize on the enormous opportunity ahead.
During the first quarter of 2025 (ended March 31), Upstart generated $213 million in total revenue, which was a 67% increase from the year-ago period. It was the fastest growth rate in three years, spurred by $2.1 billion in total loan originations, which was an 89% year-over-year jump. According to Wall Street's consensus estimate (provided by Yahoo! Finance), Upstart's annual revenue could top $1 billion in 2025 for the first time in the company's history.
Upstart stock is down 84% from its 2021 peak. Like C3.ai, it was heavily overvalued back then with its P/S ratio surging to almost 50, but it has since come down to a more sustainable level of 8. Given the company's lightning fast revenue growth right now, and the incredible future opportunity in AI-powered loan originations, I think Upstart stock could be a great long-term buy at the current price.
Should you invest $1,000 in C3.ai right now?
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Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $704,676!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $950,198!*
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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Anthony Di Pizio has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Amazon, Microsoft, Nvidia, Salesforce, and Upstart. The Motley Fool recommends C3.ai and Fair Isaac and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

2 Artificial Intelligence (AI) Stocks (Besides Nvidia) to Buy Hand Over Fist for the Long Term

Top Quantitative Traits for Rule Breaker Stocks

For Immediate Release
Chicago, IL – June 26, 2025 – Zacks Equity Research shares AppLovin APP as the Bull of the Day and Victoria’s Secret VSCO as the Bear of the Day. In addition, Zacks Equity Research provides analysis on SoFi Technologies, Inc. SOFI, Block XYZ and Upstart UPST.
Here is a synopsis of all five stocks.
AppLovin, a leading ad-tech platform powering mobile app monetization and user acquisition, has emerged as one of the most explosive growth stories in the tech sector over the past few years. Fueled by surging demand for performance-based advertising and advanced machine learning capabilities, the company has carved out a highly profitable position in a rapidly growing industry.
The stock has delivered a staggering return of over 1,300% in just two years, rewarding early believers with outsized gains. And notably, the Zacks Rank was ahead of the curve, as APP held a top Zacks Rank for much of that historic run, flagging strong earnings momentum well before the broader market caught on.
Following such a meteoric rise, shares have traded sideways over the past eight months as the valuation cooled and profit-taking set in. But now, with the stock consolidating and fundamentals continuing to strengthen, the setup is once again turning bullish. Earnings growth remains robust, and analysts have issued substantial upward revisions to estimates, indicating a strong turn higher in sentiment. With momentum building, AppLovin looks ready for its next leg higher.
Can Earnings Upgrades Propel AppLovin Stock Higher Again?
Over the past two months, AppLovin has received some of the most significant upward revisions that I have seen in a tech stock. Analysts have raised their forecasts by nearly 30% across timeframes, an unusually sharp and unanimous upgrade that has propelled APP to a Zacks Rank #1 (Strong Buy).
What makes these upgrades even more compelling is AppLovin’s impressive track record of outperforming expectations. The company has surpassed earnings estimates in each of the last four quarters, with an average surprise of 23%. That history suggests that even after these aggressive revisions, current estimates may still be conservative.
Looking ahead, earnings are projected to grow by a remarkable 88.5% in 2025, followed by another strong year of 41.1% growth in 2026. Revenue is also expected to expand at an accelerating pace, rising 16.6% this year and 20.4% next year. With both top- and bottom-line momentum and continued bullish analyst sentiment, AppLovin’s next leg higher may already be taking shape.
AppLovin Stock Breaks Out from Technical Pattern
After experiencing a sharp correction between February and April, AppLovin stock has been quietly forming a classic cup and handle pattern, a bullish technical formation that often precedes significant upward moves. This pattern typically reflects a period of consolidation and accumulation following a strong prior uptrend.
On Tuesday, the stock appeared to break out decisively above the handle’s upper resistance level, signaling a potential resumption of its broader uptrend. This breakout is another encouraging sign that investor conviction is returning.
As long as APP holds above this key breakout level, the technical setup suggests increasing momentum and the potential for continued buying pressure. If the pattern plays out in full, the measured move could imply substantial upside from current levels, reinforcing the bullish case already supported by earnings strength and analyst upgrades.
AppLovin Shares Trade at a Premium Valuation
AppLovin is not a cheap stock by any stretch. The shares currently trade at 40.6x forward earnings, which is above the industry average, but notably still below the company’s three-year median valuation of 49.3x. This elevated multiple reflects the market’s recognition of AppLovin’s robust earnings growth, strong cash flow, and dominant position within the ad-tech ecosystem.
While the valuation may give pause to traditional value investors, it remains within a reasonable range for high-growth, high-momentum tech names. For active traders and investors who focus on growth and momentum strategies, AppLovin’s premium multiple may be justified by its consistent earnings beats, accelerating revenue growth, and recent bullish breakout on the charts. In this context, the stock’s valuation, though rich, is not absurd, especially if the company continues to deliver on its aggressive growth trajectory.
Should Investors Buy Shares in APP?
With strong earnings momentum, bullish estimate revisions, and a breakout from a bullish technical pattern, AppLovin is showing all the right signals for a potential move higher. While the stock trades at a premium, its growth outlook and execution may justify the valuation. For investors focused on momentum and growth, AppLovin looks like a timely opportunity to ride the next leg of its rally.
Victoria’s Secret is my latest addition to our Bear of the Day list, and it’s another example of a once-dominant apparel brand struggling to adapt to shifting consumer preferences. Like many legacy retailers in the fashion space, Victoria’s Secret has fallen out of favor in a rapidly evolving marketplace where brand relevance and customer loyalty are harder than ever to maintain.
Revenue growth has been stagnant at best, with recent quarters showing flat or declining sales. Unfortunately, the outlook doesn’t inspire confidence either. Analysts have been steadily lowering their earnings estimates, signaling a broader loss of confidence in the company’s ability to execute a turnaround.
As a result, the stock has suffered a steep decline—down sharply year to date and significantly underperforming over the past three years. With little near-term momentum and continued downward revisions, the stock remains under pressure.
Victoria’s Secret Stock Falters on Downgrades
Victoria’s Secret has come under heavy pressure in recent months as analysts have issued sharp and widespread earnings downgrades. The stock now holds a Zacks Rank #5 (Strong Sell), reflecting both deteriorating fundamentals and rapidly falling expectations.
Over the past two months, earnings estimates have been slashed across the board. Current quarter projections have plunged by 62%, while full-year estimates for both this year and next are down 12.2% and 13.1%, respectively. Such steep revisions suggest a deepening lack of confidence in the company’s near-term performance.
The downgrades come amid a longer-term trend of declining revenue. Annual sales have fallen from $6.7 billion in 2022 to just $6.2 billion over the trailing twelve months. Looking ahead, Wall Street isn’t forecasting a rebound as sales are expected to remain essentially flat through at least next year. Without clear signs of growth or strategic reinvention, Victoria’s Secret faces a tough road ahead in an increasingly competitive retail landscape.
Should Investors Avoid VSCO Stock?
Given the sharp downward momentum in both the stock and earnings estimates, investors may want to steer clear of Victoria’s Secret for now. The company faces multiple headwinds: a stagnant top line, shrinking margins, and a highly competitive retail environment dominated by more agile, digitally native brands that are better aligned with today’s consumer preferences.
In addition to the declining revenue and earnings outlook, the company lacks a clear turnaround strategy or growth catalyst. Its brand, which once defined a category, has struggled to maintain cultural relevance in an era of shifting values and consumer expectations. Meanwhile, promotional activity across the sector is intensifying, placing further pressure on profitability.
With a Zacks Rank #5 (Strong Sell), ongoing analyst downgrades, and no visible signs of a reversal in fundamentals, VSCO appears to be a stock best avoided until there is meaningful improvement in its outlook or execution.
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SoFi's Valuation Looks Overstretched: Time to Hit Pause?
SoFi Technologies, Inc. has made a strong comeback, reflecting renewed investor confidence in its digital-first model and growing stream of fee-based income. Its asset-light platform continues to scale well, helping reduce dependence on traditional lending revenues. But with the stock now trading at over 41X forward earnings, some investors are starting to wonder if SoFi has gotten a bit ahead of itself.
While SoFi’s long-term story remains compelling, it’s important to consider the bigger picture. Ongoing geopolitical tensions, tariff-related uncertainties, and concerns of a possible economic slowdown through 2026 could introduce new challenges. These factors might not derail SoFi’s momentum entirely, but they could weigh on its valuation in the near term. For a company still partially reliant on lending, shifts in the macro environment can impact earnings more than expected.
None of this means SoFi is a sell; it’s more about being thoughtful at these levels. The recent rally has priced in a lot of optimism, so waiting for a more favorable entry could be a smart move. The fundamentals are strong, but letting the valuation catch up to the story may offer better risk-reward.
Other Fintechs to Watch While You Wait on SoFi
If SoFi feels a bit expensive right now, Block and Upstart may offer better value. Block, trading at a forward P/E of 2X, stands out for its diversified ecosystem, including Cash App and Square. Investors value Block for its balanced revenue streams and long-term fintech vision. In a choppy market, XYZ may offer steadier ground.
Meanwhile, Upstart, with a forward P/E of 33X, continues to lean into its AI-driven lending platform. Though UPST has faced volatility, it remains a strong contender if credit conditions stabilize. For those seeking growth at more grounded valuations, both Block and UPST deserve consideration while SoFi cools off.
SOFI’s Price Performance, Estimates
The stock has gained 21% in three months compared with the industry’s 10% rally.
The Zacks Consensus Estimate for SOFI’s earnings has been on the rise over the past 60 days.
SOFI stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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