UPBD Stock Forecast & Price Target

Upbound Group Inc. has demonstrated robust growth, with a notable 11% year-over-year increase in gross merchandise value (GMV) in the third quarter of 2025, indicating strong operational performance amid tightened underwriting practices. The company is experiencing faster-than-expected top-line growth, particularly from the Acima segment, which is winning more new accounts, contributing significantly to overall revenue. Additionally, there is a positive outlook for both the Rent-A-Center and Acima segments as they return to positive growth trajectories, suggesting potential for sustained acceleration in overall company performance.

Upbound Group Inc. faces a negative outlook primarily due to its 4Q25 guidance, which reported an EBITDA miss of 11% and an EPS miss of 14% compared to consensus estimates. The projections indicate a potential increase in losses from its Acima segment, which would exacerbate concerns regarding subprime consumer credit deterioration, particularly if losses exceed the historical threshold of 12%. Consequently, the company has revised its EPS estimates downward by 13% for 2026 and 10% for 2027, resulting in a significant reduction in target price and raising concerns about potential erosion of earnings and book value.