Upstart Holdings' Price Target Raised to $30 as Lawsuits Challenge AI Model
UPST•Jefferies maintained its Hold rating on Upstart Holdings while raising its price target to $30 from $27, reflecting cautious optimism. The company faces class-action suits alleging its Model 22 AI overreacted to negative economic data, potentially undermining lender risk assessments.
1. Rating Adjustment by Jefferies
On June 9, Jefferies maintained its Hold rating on Upstart Holdings and revised its 12-month price target upward to $30 from $27, signaling tempered expectations for share appreciation over the coming year.
2. Class-Action Lawsuits Over AI Performance
Investors who purchased securities between May 14, 2025, and November 4, 2025, have filed class-action suits alleging that Upstart’s Model 22 AI overreacted to negative economic indicators, leading to inaccurate credit risk assessments for partner lenders.
3. Market Capitalization and Share Volatility
Upstart’s market capitalization is approximately $2.97 billion, and its shares have swung between $23.97 and $87.30 over the past year, underscoring significant investor uncertainty around the effectiveness of its AI lending platform.
