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Feb 19, 2022Liked by Jevgenijs Kazanins

https://newsroom.transunion.com/transunion-forecasts-originations-to-non-prime-borrowers--will-continue-to-rise-for-many-credit-products-in-2022/

According to this site personal loan originations in 2021 likely totalled 17.9mil which if correct means Upstart's 1.3mil was probably closer to 7.2% of TAM. However, I guess when you consider they originated almost 500k in the last quarter alone they're probably close, if not at that 11% number now, even after adjusting for seasonality.

In terms of expansion, I've been wondering how easy international expansion would be for a company like Upstart? I've not heard them talk about this, but do you know if international expansion is even on the cards for a company like Upstart? I'm guessing there could be regulatory issues, but you would think their models should transfer quite well to similar international markets like Canada and the UK.

Finally, where would you say fair value is for the stock? Based on my projections I think $200 is fair, but it's a really hard one to model because on the one hand you have huge growth potential from auto loans mixed with lots of risks from partner concentration to regulatory risks and future competition. If they post strong beats on auto loan targets then my price target could easily double given the size of that market.

I also thought their commentary around the buyback plan was spot on. I've listened to a few earnings calls recently where management has been quite unapologetic about increased spending which hasn't been very reassuring in a market environment like this. The fact Upstart acknowledged the recent volatility in their stock and felt confident enough in the price to step in and buy suggests they both have investors backs and believe the stock is trading at an attractive valuation.

Great content btw.

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