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LendingTree Rises 15.7% Despite Mixed Q4 Results

Online financial services marketplace LendingTree, Inc. (NASDAQ: TREE) has reported mixed results for the quarter ended December 31, 2021, as earnings surpass but revenues lag expectations.

Despite the mixed results, shares of the company rose more than 15.7% to close at $116.07 in Friday’s extended trading session.

Revenue & Earnings

LendingTree reported quarterly revenues of $258.3 million, up 16% from the same quarter last year. A significant contributor to this growth were revenues generated from consumer segment and home segment, which grew 102% and 8% year-over-year to $96.4 million and $96.3 million, respectively. However, the quarterly revenues failed to surpass the consensus estimate of $259.37 million.

Meanwhile, the company reported a quarterly loss of $0.14 per share, narrower than the consensus estimate of a loss of $0.26 per share. It had posted earnings of $0.13 per share in the same quarter last year.

Other Operating Metrics

LendingTree has reported an adjusted EBITDA of $24.7 million, which represents a decline of 6% from the year-ago quarter.

Notably, the company’s variable marketing margin increased 8% from the prior year to $88.5 million, although the same metric as a percentage of revenue declined to 34% from 37% a year ago.

Outlook

For the first quarter of 2022, the company forecasts to post revenues in the range of $280 million to $290 million. For full-year 2022, the revenues are anticipated in the range of $1,200 million to $1,250 million.

Management Commentary

The CFO of LendingTree, Trent Ziegler, said, “We are pleased to affirm the fourth-quarter and full-year 2021 results we shared preliminarily at our Investor Day earlier this month, and reaffirm our previously released 2022 annual guidance.  The Home and Consumer segments continue to perform well, helping offset headwinds in our Insurance business that we see as temporary.  Our capital structure and balance sheet afford us flexibility we have not had since before the onset of the pandemic and allowed us to restart our share repurchase during the quarter.  Given the rapidly changing landscape across our industry, we are prepared to capitalize on evolving opportunities.”

Stock Rating

Consensus among analysts is a Strong Buy based on 4 Buys and 1 Hold. The average LendingTree stock prediction of $199.80 implies upside potential of 72.1% from current levels. Shares have declined 57.1% over the past year.

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