As the market continues to sell off growth stocks that report anything less than perfection during earnings season, it has been particularly eye-catching to see companies post gains after giving an update on their operations. While no single earnings call is typically make-or-break for a stock, a strong report with a promising forecast can be a harbinger of good things to come.
Such appears to be the case for the two financial-focused growth stocks that we will look at today, which not only reported solid earnings but look beautifully positioned to continue building upon their long-term growth stories.
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Upstart
Upstart ( UPST 4.59% ) and its artificial intelligence (AI) lending platform have exploded onto the investing scene since going public in late 2020, offering its banking partners a unique value proposition on credit risk. Driven by its machine learning technology, Upstart aims to disrupt the traditional credit scoring system and “enable effortless credit based on true risk.”
After rising more than 1,000% after its initial public offering, the company has seen its share price drop about 60% from its 52-week highs and has been one of the most volatile stocks in the market. However, from a strictly operational point of view, Upstart has been firing on all cylinders, including a promising fourth-quarter report that led to its share price jumping over 30% in just the last couple of weeks.
| Metric | 2020 | 2021 | Change |
|---|---|---|---|
| Revenue | $233 million | $849 million | 264% |
| Net income | $6 million | $135 million | 2,164% |
| Transaction volume | $3.4 billion | $11.8 billion | 241% |
Data source: Upstart Q4 Earnings Report.
Upstart, now partnered with 42 banks and credit unions, more than tripled its revenue and loan transaction volume from 2020 to 2021 — highlighting the burgeoning popularity within its core personal loan operations. Best yet, the company