Why Buying Upstart Stock Now Could Be a Genius Move
Whenever consumers applies for a loan, they worry about one thing: their credit score. A few points higher or lower could make a big difference in the interest rate, which could be a lot of money over the life of a loan. Especially for those starting out, a good credit score can be challenging to achieve, even with a flawless record.
To better assess risk, Upstart (NASDAQ: UPST) created its artificial intelligence (AI)-powered model, which it believes better assesses creditworthiness than Fair Isaac Corporation's (NYSE: FICO) FICO score. If you judge the product solely by the company's share price, you may think it's a flop, with the stock down nearly 95% from its all-time high. However, I think this is a misguided way to judge the business, and its stock may also be undervalued.
Upstart claims it can better assess risk than a traditional FICO model, and it provides this graphic to back up its claims:
Source Fool.com
