In the competitive world of finance stocks, two companies have caught the attention of investors for their outstanding performance. Upstart Holdings, Inc. (UPST) and Enact Holdings, Inc. (ACT) have demonstrated remarkable growth in recent months, surpassing the average returns of their sector. This article explores how these companies are faring compared to others in the finance industry and what factors are driving their success.

A Closer Look at Upstart Holdings and Enact Holdings

During a period marked by economic uncertainty, Upstart Holdings has emerged as a leading player in the finance sector. Positioned at the top of the Zacks Sector Rank, which evaluates 870 companies across 16 different groups, UPST has shown impressive resilience. The company's stock has surged by 8.7% year-to-date, significantly outperforming the average return of 4.4% seen among other finance firms. Analysts have also become increasingly optimistic about UPST’s earnings potential, with consensus estimates for full-year earnings rising by nearly 97% over the past quarter.

Meanwhile, Enact Holdings has also made notable strides, returning 4.5% since the start of the year. Although this figure is slightly below UPST's performance, it still exceeds the average for the finance sector. Enact belongs to the Insurance – Multi line industry, a segment that has faced challenges, declining by 3.4% year-to-date. Despite this, Enact has managed to improve its earnings outlook, with consensus estimates increasing by 2.2% over the past three months.

Both companies operate in distinct sub-sectors within the broader finance industry. Upstart Holdings is part of the Financial – Miscellaneous Services industry, where it ranks 39th among 87 individual stocks. In contrast, Enact Holdings is one of 41 companies in the Insurance – Multi line industry, currently ranked 146th. Notably, while UPST has excelled, its industry peers have collectively lost an average of 1.9% year-to-date, highlighting UPST's exceptional performance.

From a broader perspective, both UPST and ACT have been awarded a Zacks Rank of #2 (Buy), indicating strong buy recommendations based on their improving earnings outlooks. This ranking system, which has a proven track record of identifying market-beating stocks, suggests that investors should keep a close eye on these two companies as they continue to navigate the ever-changing financial landscape.

In conclusion, the robust performance of Upstart Holdings and Enact Holdings offers valuable insights into the finance sector. These companies' ability to outperform their peers underscores the importance of selecting stocks with strong fundamentals and positive earnings momentum. For investors looking to capitalize on the finance sector, keeping an eye on UPST and ACT could prove to be a wise strategy moving forward.