Upbound Group Inc. Common Stock (UPBD)

FairStock Score: 59/100 — STEADY

Key Financials

Strengths

• Generates $1.6 billion in annual free cash flow (142.6% yield on market cap)
• Strong Piotroski F-Score of 8/9 indicating robust financial health across profitability, leverage, and efficiency metrics
• Solid return on equity of 11.1% above cost of capital
• Attractive 7.8% dividend yield providing steady income returns
• Established organization with 12,050 employees providing operational scale

Concerns

• High leverage at 2.67x debt-to-equity increases financial risk and interest expense burden
• Altman Z-Score of 1.1 places it in the financial distress zone—elevated bankruptcy risk

AI Analysis

Upbound Group Inc. Common Stock is a micro-cap technology company valued at $1.1 billion. The business generates $4.7 billion in annual revenue with a 0.4% net margin and $1.6 billion in free cash flow. From a quality standpoint, Upbound shows near-perfect Piotroski F-Score of 8/9 indicating exceptional financial health and distressed Altman Z-Score of 1.1 warrants caution. On valuation, the stock is reasonably priced at 15.6x earnings, with trades above its Graham Number with a negative 7% margin. Growth dynamics show revenue growing at 10.9% and profit growth of -36.3%. The 7.8% dividend yield adds an income component for patient holders. Our composite FairStock Score of 59/100 reflects mixed fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

Improving fundamentals and sector tailwinds could drive meaningful earnings growth, compressing the effective multiple for patient investors. With $1.6 billion in annual free cash flow (142.6% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

Elevated leverage at 2.7x D/E means rising interest rates or revenue weakness could strain debt covenants and force asset sales at distressed prices. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer