We recently compiled a list of the 10 Best Performing Fintech Stocks to Buy According to Analysts. In this article, we are going to take a look at where Upstart Holdings, Inc. (NASDAQ:UPST) stands against the other best-performing fintech stocks.
Fintech, or financial technology, is transforming the way the world handles money. It is making financial services faster, more accessible, affordable, and user-friendly. The fintech sector is experiencing rapid growth driven by several key trends. These trends include the adoption of artificial intelligence (AI) and the rise of e-commerce. These factors are driving growth and supporting the demand for innovative payment solutions, embedded finance, and secure transaction technologies. Embedded finance, which involves integrating financial services into everyday digital experience, is becoming essential for businesses to stay competitive and apart from e-commerce, it is becoming especially important for sectors like healthcare, education, and real estate.
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According to a report by IMARC Group, the global fintech market was valued at $218.8 billion in 2024. The market is expected to grow at a compound annual growth rate (CAGR) of 15.82% during 2025-2033 to reach a value of $828.4 billion by the end of the forecast period. In 2024, North America dominated the fintech market, accounting for more than 35.8% of the market share.
From digital payments and fraud prevention to AI-powered insurance and blockchain technology, fintech continues to revolutionize traditional finance. With new and innovative solutions that fintech offers, it is no surprise that fintech is becoming increasingly popular, especially among younger generations who prefer using smartphones or laptops for tasks like making payments, investing, or even seeking financial advice.
Traditional financial institutions are also investing heavily in fintech products to stay relevant. This has made fintech a high-growth industry, which presents a significant opportunity for investors to invest in companies that are leading financial innovation.
Methodology
To compile our list of the 10 best-performing fintech stocks to buy according to analysts, we looked for the biggest fintech companies. We reviewed our own rankings, financial media reports, ETFs, and various online resources to compile a list of the best fintech stocks. Then we looked for the best-performing stocks in the fintech sector and narrowed down our list to stocks that have gained at least 8% year-to-date as of February 26, 2025. Next, we focused on the top fintech stocks that analysts believe have the most potential for growth. Finally, we ranked the 10 best-performing fintech stocks to buy based on their average price target upside potential according to analysts as of February 26, 2025.
Additionally, we mentioned the hedge fund sentiment surrounding each stock, which was taken from Insider Monkey’s Q4 2024 database of more than 1,000 elite hedge funds.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A close-up of a businesswoman using a laptop, being illuminated by the AI-enabled cloud interface sponsored by the company.
Upstart Holdings, Inc. (NASDAQ:UPST)
Year-to-Date Performance: 13.13%
Average Price Target Upside Potential According to Analysts: 16.31%
Number of Hedge Fund Holders: 39
Upstart Holdings, Inc. (NASDAQ:UPST) is an American fintech company that operates a cloud-based artificial intelligence (AI) lending marketplace. The company partners with banks and credit unions and offers personal loans, automotive retail and refinance loans, home equity lines of credit, and small-dollar “relief” loans through its platform. Upstart AI allows lenders to approve more borrowers at lower rates while delivering an impressive digital-first experience that is customer-friendly. Upstart Holdings, Inc. (NASDAQ:UPST) ranks among the best-performing stocks in the fintech sector.
The company is focused on achieving significant growth through innovative models and product developments. In Q4 2024, Upstart Holdings, Inc. (NASDAQ:UPST) launched Model 19, which introduced the Payment Transition Model (PTM). This new capability allows the underwriting model to consider intermediate delinquency states, making it more accurate than previous models. Additionally, in Q4 2024, Upstart Holdings, Inc. (NASDAQ:UPST) released new underwriting models for both its auto refinance and auto retail products, which led to increased conversion rates. The company also automated the counter-offer process, an important conversion booster. In December 2024, Upstart Holdings, Inc. (NASDAQ:UPST) introduced a machine learning-powered feature that increased instant income verification rates by 34%. The company is also working to accelerate its ability to cross-sell HELOCs to prior borrowers and finished 2024 with HELOCs being offered in 36 states, representing 60% of the US population.
These strategic moves helped Upstart Holdings, Inc. (NASDAQ:UPST) deliver exceptional results for the quarter. In Q4 2024, total revenue was $219 million, representing a 56% year-over-year increase. Transaction volume was up 68% year-over-year while the conversion rate was 19.3%, up from 11.6% in Q4 2023.
Overall, UPST ranks 6th on our list of the best-performing fintech stocks to buy according to analysts. While we acknowledge the potential of UPST as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than UPST but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
