TD Cowen Highlights Structural Growth in Specialty Finance, Keeps Upbound (UPBD) Buy

Upbound Group, Inc. (NASDAQ:UPBD) is included among the 13 Dividend Stocks with Over 8% Yield.

On January 8, TD Cowen analyst Hoang Nguyen trimmed Upbound Group, Inc. (NASDAQ:UPBD)’s price target to $30 from $31. However, the firm maintained a Buy rating on the stock. The adjustment reflected the firm’s broader view of the specialty finance space, where macro pressures are weighing on the outlook even as several areas of consumer credit continue to show long-term growth. The analyst pointed to ongoing expansion across credit cards, auto and student lending, non-prime credit, buy-now-pay-later, and lease-to-own models.

Upbound’s third-quarter results backed up that constructive view. Revenue climbed 9% from a year earlier to $1.16 billion, while adjusted EBITDA rose 5.7% to $123.6 million. Rent-A-Center showed clear sequential improvement in same-store sales and held firm on margins, posting a 16.2% adjusted EBITDA margin. Management now expects same-store sales to move closer to flat, or even slightly positive, in the fourth quarter.

Brigit was another bright spot. The platform delivered 40% revenue growth and lifted its subscriber base by 27% year over year, while continuing to roll out new products. Upbound completed the Brigit acquisition in early 2025, adding a fast-growing digital offering to the portfolio.

Cash generation also stood out. The company produced more than $50 million in free cash flow during the quarter, pushing year-to-date free cash flow to $167 million.

Upbound Group, Inc. (NASDAQ:UPBD) is a technology- and data-driven financial services company focused on building products that meet everyday consumer needs across a range of credit and payment options.

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