Upstart Holdings’ (UPST) Strong Earnings Report Made Maple Tree Capital to Increase Its Holdings

Maple Tree Capital, an investment management company, released its Q1 2025 investor letter. A copy of the letter can be downloaded here. Q1 2025 saw a strong start but turned sour due to tariff concerns and macroeconomic fears, leading to a sharp market pullback, with the Nasdaq falling nearly 22% from its highs and the S&P 500 down 20%. Despite the challenges, the firm made significant progress this quarter by averaging in the top-conviction stocks, utilizing covered calls, and exercising patience. Maple’s growth-oriented fund, Jonagold, has become a standout performer, greatly surpassing all major benchmarks since its launch in 2023. While Heartwood is still facing difficulties. Maple Tree Capital’s Jonagold returned -13.64% in Q1 compared to the Nasdaq’s -10.26% return and the Russel 2000’s -9.48% return. Maple Tree Capital’s Heartwood returned -18.04% in Q1 vs. the S&P 500’s -4.27% and the Dow Jones’ -0.87% return. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its first-quarter 2025 investor letter, Maple Tree Capital highlighted stocks such as Upstart Holdings, Inc. (NASDAQ:UPST). Upstart Holdings, Inc. (NASDAQ:UPST) is a US-based artificial intelligence (AI) lending platform. The one-month return of Upstart Holdings, Inc. (NASDAQ:UPST) was -1.65%, and its shares have appreciated by 93.62% over the past 52 weeks. On May 28, 2025, Upstart Holdings, Inc. (NASDAQ:UPST) closed at $47.01 per share, with a market capitalization of $4.535 billion.

Maple Tree Capital stated the following regarding Upstart Holdings, Inc. (NASDAQ:UPST) in its Q1 2025 investor letter:

“We significantly increased our investment in Upstart Holdings, Inc. (NASDAQ:UPST), our largest holding, this quarter, following an exceptionally strong Q4 earnings report. In fact, we boosted our position by 12.67%, a significant size increase considering it was already our biggest position.

Let us be clear, our conviction in Upstart is unwavering. While shares have fallen roughly ~60% since February, our conviction has only grown. We took advantage of the market’s pessimism and significantly added to our stake both in Q1, and in the start of Q2.

Upstart reported $219 million in Q4 revenue, smashing its own $180 million guidance, topping Wall Street’s $182 million estimate, and exceeding our internal forecast of $200 million. More importantly, Q4 solidified that the Upstart comeback story we’ve been sharing with you all is in full force. Upstart is executing at a high level against an unfavorable macro backdrop while the market continues to underestimate the strength of its recovery. This only ends one day…” (Click here to read the full text)

Upstart Holdings, Inc. (NASDAQ:UPST) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 33 hedge fund portfolios held Upstart Holdings, Inc. (NASDAQ:UPST) at the end of the first quarter, which was 39 in the previous quarter. Upstart Holdings, Inc. (NASDAQ:UPST) reported revenue of $213 million in Q1 2025, up 67% year-on-year. While we acknowledge the potential of Upstart Holdings, Inc. (NASDAQ:UPST) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the undervalued AI stock set for massive gains.

In another article, we covered Upstart Holdings, Inc. (NASDAQ:UPST) and shared billionaire David E. Shaw’s small-cap stock picks with huge upside potential. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors.

READ NEXT: Michael Burry Is Selling These Stocks and A New Dawn Is Coming to US Stocks.

Disclosure: None. This article is originally published at Insider Monkey.