5 Meme Stocks Redditors are Buying in April

1. Upstart Holdings, Inc. (NASDAQ:UPST)

Number of Hedge Fund Holders: 20 

Upstart Holdings, Inc. (NASDAQ:UPST) owns and runs a cloud-based lending platform. In early March, the stock dropped by more than 14% in a single day after Dave Girouard, the CEO of the firm, sold nearly 133,000 shares in the company. Over the past twelve months, the shares have lost more than 23% in value as inflation climbs and batters growth stocks. However, the mentions of the firm on Reddit have climbed in the meanwhile, leading to renewed retail investor interest. 

On March 22, Wedbush Securities analyst David Chiaverini downgraded Upstart Holdings, Inc. (NASDAQ:UPST) stock to Underperform from Neutral and lowered the price target to $75 from $110, noting that the underwriting model of the firm was yet to be battle-tested as a recession looms. 

Among the hedge funds being tracked by Insider Monkey, New York-based investment firm Third Point is a leading shareholder in Upstart Holdings, Inc. (NASDAQ:UPST) with 12.4 million shares worth more than $3.9 billion. 

At the end of the fourth quarter of 2021, 20 hedge funds in the database of Insider Monkey held stakes worth $1 billion in Upstart Holdings, Inc. (NASDAQ:UPST), compared to 23 in the preceding quarter worth $5 billion.

In its Q4 2021 investor letter, Vulcan Value Partners, an asset management firm, highlighted a few stocks and Upstart Holdings, Inc. (NASDAQ:UPST) was one of them. Here is what the fund said:

“Upstart Holdings, Inc. (NASDAQ:UPST) was another material detractor during the quarter. Upstart is an artificial intelligence (AI) and cloud-based lending platform. Upstart uses over 1600 variables in its AI models. Its lending platform delivers lower default rates, higher approval rates, lower rates for consumers, and higher returns on investment for its bank and institutional clients. As former owners of FICO, we believe Upstart has the potential to be the FICO of the 21st century. Recent stock price volatility has given us an opportunity to follow our investment discipline. During the third quarter of 2021, Upstart’s stock price increased significantly, and we materially reduced our position in the company. Following its most recent earnings release, our value increased but Upstart’s stock price began to decline significantly. With a significantly improved price to value ratio, we added to our position in Upstart Holdings, Inc. (NASDAQ:UPST). We simply took advantage of stock price volatility to manage risk in the portfolio and improve our returns and our prospective returns.”

You can also take a peek at 10 Best Healthcare Dividend Stocks to Buy Now and 10 Dividend Stocks with Over 20 Years of Dividend Increases.

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