LendingTree Lifts 4Q Sales Outlook; Shares Spike 16%

LendingTree stock popped 16.1% on Tuesday after the online lending marketplace raised its revenue guidance for 4Q above analysts’ expectations. The company expects to report quarterly results on Feb. 25.

LendingTree (TREE) projects 4Q sales to generate between $220 million and $222 million, up from the earlier guidance range of $200 million to $215 million. Analysts has been expecting $210.4 million. In the year-ago quarter, the company reported $255.2 million in revenue.

Furthermore, the company anticipates its 4Q adjusted EBITDA to be in the range of $24 million to $26 million, compared to the previous guidance of $13 million to $18 million.

LendingTree CFO J.D. Moriarty said, “While we’re pleased to report fourth quarter results better than expected, what’s more encouraging is the ramping momentum as we enter 2021. Across our three reported segments, much of the quarter’s outperformance was driven by strength in our Home segment which grew revenue more than 30% over the prior year period.” (See TREE stock analysis on TipRanks).

Following the better-than-expected 4Q preliminary results, Oppenheimer analyst Jed Kelly maintained a Buy rating on the stock with a price target of $395 (26.1% upside potential). The analyst said, “We are most encouraged by mortgage lender trends that we expect to carry into 2021, and see Credit Cards and Personal Loans recovery starting to accelerate in 2Q.”

Overall, consensus among analysts is a Strong Buy with all the 7 analysts covering the stock over the past three months recommending a Buy. The average price target of $360 implies upside potential of 14.9% to current levels. Shares were up by 2.4% over the past year.

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