Those are kind words, Saul, and I also appreciate everyone else who gave shoutouts in other threads!
I did not know this board existed until about two months ago and at the time I was looking for a place where I can share my insights into UPST and benefit from a shared discussion. I’m happy my writings have been helpful.
Fun fact, I had read Upstart’s S1 back in December 2020 when they had their IPO. But I brushed them off as “just another AI buzzword company”. It was Q4 earnigns in March that put it back on my watchlist. And then Q1 earnings led me to spend the entire after-market hours night digging deep into the company. A classic case of ‘follow the numbers’ - but I certainly lacked the foresight that GauchoRico and others had for buying shares prior to March Q4 earnings release.
I still remember in shock when the stock price tumbled on May 12 after the Q1 report, it opened at $115 and down to $88; wow what a gift that was!
It is still very befuddling to me why it crashed on such strong fundamental results/guidance, and even more puzzling to me when UPST’s share price languished after IPO lock up expiry in June, all the way up to Q2 release this week. But that was also another gift, as I averaged up on ever more shares in its tight several week range around $120.
Anyway, I’d like to still materially contribute to this board on UPST, within this post reply.
I just finished watching another Upstart Jeff Keltner video, uploaded two days ago, although it appears this was a webinar between Upstart and prospective bank partners recorded in March 2021
35:22 timestamp - “four to five months is on the better side of average” for the timeline it takes a bank partner to be signed up and fully implemented. Not ‘fast’ by any means but that’s the nature of the conservative banking industry, I suppose.
45:51 timestamp - graphs showing COVID peak payment impairment, UPST reached an excess peak of 6 percent in a modified repayment program but 95% of those recovered back to current regular payments by Q3 2020.
This strongly outperformed the industry overall which only 81% were back to current in that timeframe.
In comparison, LendingClub, per the latest March 2021 KBRA surveillance report, 12.4% of loans at its COVID peak (more than double that of Upstart) had to enroll in assistance programs and only 63% of them returned to regular payments by Feb 2021. That’s 63% of 12.4 = 4.588% still in loan modification
And, I confirmed UPST’s numbers from the video: according to KBRA, “UPST’s active modification levels peaked in May 2020 at approximately 5.6%.” But here’s the kicker, if we expand the timeframe to March 2021, then “for Upstart Platform originations from January 2020 through March 31, 2021 and as of March 31, 2021, loans in active modifications decreased to approximately 0.15%.”
Just compare that: 0.15% UPST in modification versus 4.588% LendingClub in modification. Wow!
50:12 timestamp - “Most bank partners looking for $1 to $10 to $15 million volume a month in personal loan originations” [This means if Upstart has 100 bank partners, they might average $1B a month in personal loan originations which may generate $70 million in fee revenue per month = $210 million fee revenue per quarter. Not “massive”, but this would be for personal loans alone. I continue to believe auto refinance/lending growth is absolutely essential for UPST to continue to outperform earnings next year]