Upstart Stock Surges 3.73% on $460M Trading Volume Rises to 226th Highest Volume as AI Lending Platform Sparks Renewed Investor Interest

Upstart (UPST) surged 3.73% on August 20, 2025, with a trading volume of $460 million, marking a 45.03% rise from the previous day. The fintech lender’s stock climbed to the 226th highest volume on the day, reflecting renewed investor interest in its AI-driven lending platform.

Despite a flat year-to-date performance, Upstart’s second-quarter results underscored its operational resilience. Loan originations hit a three-year high of $2.8 billion, driven by expanding partnerships and improved AI underwriting models. The company’s revenue mix shifted toward fee-based income, with $241 million generated from fees—a 84% annual increase—reducing reliance on credit risk exposure. Small-dollar loans and auto lending now account for over 10% of total originations, signaling diversification into high-growth segments.

Margin improvements and strategic balance sheet management further bolster confidence. Contribution margins rose to 58% in Q2, aided by AI-driven cost optimization. While the firm maintains $1.02 billion in loans on its books, management emphasized a focus on external capital to limit long-term risk. Analysts remain cautious due to macroeconomic uncertainties but highlight the stock’s potential for recovery, with a top price target of $105 implying nearly 70% upside.

The strategy of buying the top 500 stocks by daily trading volume and holding them for one day from 2022 to 2025 yielded a 0.98% average 1-day return, accumulating 31.52% total returns over 365 days. This reflects moderate short-term momentum but underscores the volatility and timing risks inherent in volume-based strategies.