TD Cowen analysts reiterate buy rating for Upbound Group stock

On Monday, TD Cowen analysts reiterated a Buy rating for Upbound Group stock (NASDAQ: UPBD) and maintained a price target of $34.00. The analysts continue to see strong growth in Upbound’s Acima business and highlight the company’s profitability. According to InvestingPro data, the company has maintained profitability over the last twelve months, with a healthy gross profit margin of 48%.

The analysts noted that Upbound Group shares are trading at a significant discount compared to historical levels and peers. Despite this, the company is experiencing rapid growth in its Acima division, which is outperforming its competitors and expanding its partner locations with the help of a large sales force. InvestingPro analysis suggests the stock is currently undervalued, with revenue growing at 8% year-over-year. Get detailed valuation metrics and 8 additional ProTips with an InvestingPro subscription.

The report also mentioned that Upbound Group’s store-based LTO business, Rent-A-Center (NASDAQ:UPBD) (RAC), is under growth pressure but has still managed to surpass its peers in recent years. Upbound Group maintains a solid profitability with a return on equity in the mid-30% range, the highest in its group.

The acquisition of Brigit is seen as highly complementary to Upbound Group’s operations and is expected to be accretive in the long term. The analysts believe that the company’s valuation remains attractive relative to its peers and historical averages.

In other recent news, Upbound Group Inc. reported robust financial results for the first quarter of 2025, exceeding Wall Street expectations. The company achieved an earnings per share (EPS) of $1.00, surpassing the projected $0.95, and reported revenues of $1.18 billion, outpacing the anticipated $1.13 billion. These results reflect a 7.3% year-over-year increase in revenue and a 16% rise in adjusted EBITDA, highlighting the company’s operational efficiency and strategic initiatives. Upbound Group’s strategic moves, including the acquisition of Bridget and improvements in its product offerings, have contributed to its growth. The company’s exit from low-margin product categories and enhancements in lease charge-offs further underscore its focus on profitability. Additionally, the firm has set a revenue guidance of $4.6 to $4.75 billion for 2025, with plans to expand its market presence into Mexico. Analyst firms have not provided any recent upgrades or downgrades for Upbound Group.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.