Upstart Holdings Inc (NASDAQ:UPST) Stands Out as a High-Growth Momentum Stock with Strong Technical Setup

High-growth momentum investing looks for stocks with strong earnings growth, positive estimate changes, and increasing profit margins, qualities that often lead to notable price gains. Pairing this with technical analysis helps find the best times to buy, allowing investors to benefit from both strong fundamentals and favorable price patterns. Upstart Holdings Inc (NASDAQ:UPST) stands out as a strong choice in this approach, performing well in both growth momentum and technical indicators.

Why UPST Meets High Growth Momentum Standards

The ChartMill High Growth Momentum Rating checks short-term earnings trends, sales growth, and analyst outlook, important factors for high-growth stocks. UPST earns a 6 out of 10 on this rating, backed by:

• Strong EPS Growth:

  • Quarterly EPS growth (year-over-year) jumped 196.8% in the latest quarter, after an even higher 336.4% in the previous quarter.
  • Next quarter estimates predict further growth, with EPS expected to rise 253.6%.
  • Over the past year, EPS growth is 180.5%, showing consistent progress.

• Faster Revenue Growth:

  • Sales increased 67% year-over-year last quarter, up from 56% in the prior quarter.
  • Future estimates point to 80.1% growth next quarter, indicating ongoing demand for UPST’s AI-based lending platform.

• Positive Earnings Surprises and Estimate Changes:

  • UPST has exceeded EPS estimates by an average of 213.6% over the last four quarters.
  • Analysts have raised next-year EPS estimates by 6.3% in the past three months, showing growing optimism.

• Improved Free Cash Flow:

  • FCF per share grew 123.3% over the past year, highlighting better profitability.

These numbers match the CANSLIM and Minervini strategies, which focus on earnings growth and rising estimates as drivers of strong performance.

Technical Performance and Setup Quality

UPST’s technical picture is also strong, with a perfect 10/10 Technical Rating and a 7/10 Setup Rating in ChartMill’s review (full report here). Key points:

• Trend Strength:

  • Both short-term and long-term trends are positive, with the stock near the top of its 52-week range.
  • Relative strength is in the top 2% of stocks, beating 98% of its Consumer Finance peers.

• Potential Breakout:

  • Prices have been holding near resistance at $83.83,$84.46, a possible breakout area.
  • Support is at $79.08,$79.21, providing a clear stop-loss level.
  • A recent Pocket Pivot signal, where volume on an up move exceeds the highest down-volume of the past 10 days, suggests buying interest.

• Bull Flag Formation:

  • The stock is shaping a bull flag, a pattern often followed by further gains.

Why This Pairing Works

High-growth stocks with solid technical setups often see extended rallies. UPST’s fundamentals support its momentum, while its chart points to a favorable entry. A confirmed breakout above resistance could signal more upside.

Find More High-Growth Momentum Opportunities

For investors looking for similar stocks, our High Growth Momentum Breakout Screen filters for stocks with:

• High Growth Momentum Rating ≥ 6
• Technical Rating ≥ 7
• Setup Rating ≥ 7

Disclaimer: This analysis is not investment advice. Always do your own research and use risk management before trading.