Upstart Holdings, Inc.

Where It Passes

Where It Falls Short

• Profitability0% pass✓ 5✗ 30▾

  No clean pass — all 16 investors flag at least one profitability criterion

  Positive EPS (10 years)2/8 years positive

  ✗GrahamPositive EPS every year for 10 years

  EPS Growth (3-yr avg, 10-yr window)N/A (negative base EPS)

  ✗Graham>= 33% growth

  Net Income Positive (10+ years)3/8 years positive

  ✗BuffettPositive every year for 10+ years

  ROE (up to 5-year arithmetic mean)-10.2%

  ✗Buffett> 15% arithmetic mean (app rule)

  Operating Margin (10-yr trend)4.1% (latest)

  ✗BuffettStable or rising over 10 years

  Free Cash Flow Proxy$78.1M

  ✓BuffettPositive and growing

  Earnings Variance (10-yr CoV)N/A (negative mean EPS)

  ✗BuffettCoV < 0.3

  Retained Earnings Effectiveness

  ✗Buffett$1 retained -> > $1 market value created

  Basic earnings-growth PEG (dividends excluded)P/E 43.5x (growth N/A)

  ✗Lynch< 1.0 (ideally < 0.5)

  3-5 Year EPS CAGR-25.1%

  ✗Lynch15-30% (Fast Grower); > 0% to pass

  ROE7.3%

  ✗Lynch> 15%

  Net Income / Total Assets1.80%

  ✓PiotroskiROA > 0

  ROA Change YoY-5.43% -> 1.80% (delta: +7.23%)

  ✓PiotroskiCurrent ROA > Prior ROA

  (CFO / Total Assets) vs ROACFO/Assets=-4.97%, ROA=1.80%

  ✗PiotroskiCFO/Assets > ROA

  Pre-Tax Income / Revenue5.2%

  ✗Dreman>= 8%

  Net Income / Shareholders' Equity7.3%

  ✗Dreman> 12%

  Return on Equity7.3%

  ✗Munger> 15%✗AkreROE > 20% (3-year avg)

  Margin of SafetyP/E=43.5x, P/TBV=2.7x

  ✗PabraiP/TBV < 1.5 or P/E < 15

  ROE (high and growing)FY2023: ROE=-37.8%; FY2024: ROE=-20.3%; FY2025: ROE=6.7%

  ✗AkreLatest 3 consecutive FYs: ROE > 15% in each

  Discount to Intrinsic ValueN/A (negative normalized EPS)

  ✗Marks>= 20% below intrinsic value

  Positive Net Income Frequency3/7 years positive

  ✗MarksPositive net income in >= 7 of last 10 years

  Operating Income / Revenue4.6%

  ✗Ackman>= 15%

  Net Income / Shareholders Equity7.3%

  ✗Ackman>= 15%

  5-Year EPS CAGR

  ✗Templeton> 0% (5-year EPS CAGR)

  Operating Margin Trend-50.0% (2023) -> 4.1% (2025)

  ✓TempletonNon-negative operating-margin trend over 3 years

  Revenue growth vs. gross and operating margin trendrevenue up, operating margin -50.0% -> 4.1%

  ✓SleepRevenue rising; gross margin flat or falling; operating margin holding

  ROE (5-year)1/5 years above 12% (latest 6.7%)

  ✗SleepROE > 12% in a majority of years

  Net income / market capitalization+3.37%; #2254/6340 (top 35.6%)

  ✗AsnessTop 30% of eligible cross-section✗OshaughnessyTop 10% of eligible cross-section

  Gross profit / total assets

  ✗AsnessTop 30% of eligible cross-section

  Net income / positive book equity+7.34%; #2189/5226 (top 41.9%)

  ✗AsnessTop 30% of eligible cross-section

  Negative 5-year standard deviation of ROA-0.0669; #2951/5884 (top 50.2%)

  ✗AsnessTop 30% of eligible cross-section

  3-5 Year Diluted EPS CAGR-25.1% over 4 years

  ✗Neff7%-20% annualized

  Positive Diluted-EPS Years2/7 years positive

  ✗Schloss>= 70% positive over 5-10 observed years (app rule)
• Valuation0% pass✓ 2✗ 24▾

  No clean pass — all 12 investors flag at least one valuation criterion

  Price / 3-yr avg EPS

  ✗Graham<= 15x

  Price-to-Tangible-Book Ratio2.7x

  ✗Graham<= 1.5x

  P/E x P/TBV

  ✗Graham<= 22.5

  Basic earnings-growth PEG (dividends excluded)P/E 43.5x (growth N/A)

  ✗Lynch< 1.0 (ideally < 0.5)

  Price / EPS43.5x

  ✗Dreman< 12x✗Templeton< 12x (fixed ceiling; proxy for the market's cheapest 40%)

  Price / (CFO / Shares)N/A (negative CFPS)

  ✗Dreman< 8x

  Price / Tangible Book Value per Share2.7x

  ✗Dreman< 1.2x✗SchlossP/TBV <= 1.00x (app cutoff)

  Valuation ReasonablenessP/E=43.5x, OE Yield=4.1%

  ✗MungerP/E < 25 or Owner Earnings Yield > 5%

  P/E or FCF YieldP/E=43.5x, FCF Yield=-7.7%

  ✗PabraiP/E < 15 or FCF Yield > 10%

  P/B or P/E vs. Historical AverageP/E=43.5x, P/B=2.4x

  ✗MarksP/E < 15 or P/B < 2.0

  Discount to Intrinsic ValueN/A (negative normalized EPS)

  ✗Marks>= 20% below intrinsic value

  Price / FCF per ShareN/A (negative FCF)

  ✗Ackman<= 25

  Price vs. Trailing Low100% of trailing low ($19.56)

  ✓Templeton<= 120% of trailing low (certified split-adjusted live window)

  Price / Book Value per Share2.4x

  ✗Templeton< 1.5x✗SchlossP/B <= 0.80x (app cutoff)

  Net income / market capitalization+3.37%; #2254/6340 (top 35.6%)

  ✗AsnessTop 30% of eligible cross-section✗OshaughnessyTop 10% of eligible cross-section

  Positive book equity / market capitalization+0.4587; #3038/6449 (top 47.1%)

  ✗AsnessTop 30% of eligible cross-section

  Price / Diluted EPS43.5x

  ✗NeffP/E <= 15x (app proxy for a P/E 40%-60% below the market)

  (EPS CAGR % + Dividend Yield %) / P/E

  ✗Neff> 0.7 (Neff's published traditional edge)

  Book Value per Share Change+98.9%

  ✓SchlossLatest BVPS >= earliest BVPS over >= 3 years (app rule)

  Revenue / market capitalization+0.6924; #2216/5247 (top 42.2%)

  ✗OshaughnessyTop 10% of eligible cross-section

  (Operating cash flow - capex) / market capitalization-9.66%; #3221/4519 (top 71.3%)

  ✗OshaughnessyTop 10% of eligible cross-section

  Trailing six-month price return through the evaluation date-28.25%; #4337/6202 (top 69.9%)

  ✗OshaughnessyTop 10% of eligible cross-section
• Valuation models0% pass✗ 3▾

  UPST overvalued: all 3 models price fair value below $19.56 (median $9.41)

  Graham fair value$9.08

  ✗Graham-115.4% margin vs $19.56

  Buffett fair value$9.41

  ✗Buffett-107.9% margin vs $19.56

  Pabrai fair value$12.47

  ✗Pabrai-56.9% margin vs $19.56
• Verdicts14% pass✓ 2✗ 12▾

  Split decision: 12 FAIL · 2 PASS · 2 NEUTRAL

  Overall verdict

  ✗GrahamFAIL (1/7)✗BuffettFAIL (1/6)✗LynchFAIL (0/4)✓PiotroskiPASS (F-Score 4)✗DremanFAIL (2/9)✗MungerFAIL (0/3)✗PabraiFAIL (0/3)✗AkreFAIL (1/5)✗MarksFAIL (1/4)✗AckmanFAIL (3/8)✗TempletonFAIL (3/8)✓SleepPASS (3/6)•AsnessNEUTRAL (Not ranked)✗NeffFAIL (1/6)✗SchlossFAIL (1/7)•OshaughnessyNEUTRAL (Not ranked)
• Cash Flow20% pass✓ 2✗ 10▾

  8 of 10 flag UPST's cash flow — Lynch, Piotroski, Dreman +5 more

  Free Cash Flow Proxy$78.1M

  ✓BuffettPositive and growing

  FCF Positive and Growing$-187.0M

  ✗LynchPositive and growing

  Operating Cash Flow$-147.7M

  ✗PiotroskiCFO > 0

  (CFO / Total Assets) vs ROACFO/Assets=-4.97%, ROA=1.80%

  ✗PiotroskiCFO/Assets > ROA

  Price / (CFO / Shares)N/A (negative CFPS)

  ✗Dreman< 8x

  P/E or FCF YieldP/E=43.5x, FCF Yield=-7.7%

  ✗PabraiP/E < 15 or FCF Yield > 10%

  FCF Positive4/7 years FCF positive

  ✓MarksPositive FCF in majority of recent years

  (OCF - CapEx) / Market Cap-9.7%

  ✗Ackman>= 4%

  Price / FCF per ShareN/A (negative FCF)

  ✗Ackman<= 25

  Positive Operating Cash Flow frequency4/7 years positive

  ✗SleepPositive OCF in >= 70% of available years

  Operating Cash Flow - Capital Expenditures$-187.0M

  ✗Neff> $0 (app proxy for a strong fundamental case)

  (Operating cash flow - capex) / market capitalization-9.66%; #3221/4519 (top 71.3%)

  ✗OshaughnessyTop 10% of eligible cross-section
• Debt & Leverage25% pass✓ 1✗ 4▾

  3 of 4 flag UPST's debt & leverage — Templeton, Asness and Schloss

  LT Debt / Total Assets Change0.00% -> 0.00%

  ✓PiotroskiDecreased YoY

  Total Debt / Shareholders' Equity2.28

  ✗Templeton< 1.0 (fixed cap; proxy for below-sector-median leverage)✗SchlossD/E < 1.00x

  Negative debt-to-equity (higher means less debt)-2.2845; #3842/4210 (top 91.3%)

  ✗AsnessTop 30% of eligible cross-section

  Current Assets / Current Liabilities

  ✗SchlossCurrent ratio >= 1.50x (app cutoff)
• Growth25% pass✓ 5✗ 7▾

  6 of 8 flag UPST's growth — Graham, Lynch, Dreman +3 more

  EPS Growth (3-yr avg, 10-yr window)N/A (negative base EPS)

  ✗Graham>= 33% growth

  Basic earnings-growth PEG (dividends excluded)P/E 43.5x (growth N/A)

  ✗Lynch< 1.0 (ideally < 0.5)

  3-5 Year EPS CAGR-25.1%

  ✗Lynch15-30% (Fast Grower); > 0% to pass

  EPS Growth Direction$-0.03 (2019) -> $0.45 (2025)

  ✓DremanPositive over recent years

  EPS CAGR

  ✗Dreman> 5% annualized

  Positive Net Income Frequency3/7 years positive

  ✗MarksPositive net income in >= 7 of last 10 years

  3yr Median Revenue Growth23.9%

  ✓Ackman>= 5%

  Positive EPS Growth Frequency3/5 years with positive EPS growth

  ✓AckmanPositive EPS growth in >= 3 of last 5 years

  5-Year EPS CAGR

  ✗Templeton> 0% (5-year EPS CAGR)

  Revenue growth vs. gross and operating margin trendrevenue up, operating margin -50.0% -> 4.1%

  ✓SleepRevenue rising; gross margin flat or falling; operating margin holding

  5-year Revenue CAGR34.9%

  ✓SleepCAGR > 7%

  3-5 Year Diluted EPS CAGR-25.1% over 4 years

  ✗Neff7%-20% annualized
• Efficiency33% pass✓ 1✗ 2▾

  2 of 3 flag UPST's efficiency — Akre and Sleep

  Revenue / Total Assets Change YoY0.27x -> 0.35x

  ✓PiotroskiImproved YoY

  Reinvestment Rate x ROIC6.7% (RR=100% x ROIC=6.7%)

  ✗AkreReinvestment Rate * ROIC > 10%

  ROE (5-year)1/5 years above 12% (latest 6.7%)

  ✗SleepROE > 12% in a majority of years