My favorite stock market quote may be this analogy from Andre Kostolany, translation mine:
The relationship between the economy and the stock market is like a man walking his dog to a park. When they walk together, the dog runs around randomly. Sometimes the dog runs in front of the man, sometimes behind the man. When they got to the park, the man had walked a mile, but the dog ran four miles.
Here, the man is the company and the dog is the stock price. The important thing is that they will eventually get to the park at the same time.
What I saw in the last month regarding Upstart the man:
- Posted 250% YoY revenue growth and guided 16% QoQ growth for the next quarter.
- Selected by BCU for personal lending.
- Expanded relationship with First National Back of Omaha after 2 years of pilot lending program.
- Partnered with National Bankers Association to provide tech for minority owned banks.
The dog, on the other hand, had retreated very far from where it was one month ago.
Can I predict where the dog will go tomorrow, or even next month? No, I can’t. But I see that the man is doing well. Therefore, as an investor, I choose to ignore the noise and continue putting my money on the man, not the dog.