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On Tuesday, Lending Tree shares (currently trading at $40.64) received an upgraded stock rating from Northland, moving from Market Perform to Outperform. The firm also set a price target for the company's stock at $60.00, joining five other analysts who have recently revised their earnings expectations upward according to InvestingPro data.
The upgrade comes after a period of revenue growth in 2024, particularly in the Insurance sector, which did not significantly impact the company's bottom line. The company has shown promising signs, with an impressive 11.16% return over the past week, though Northland acknowledges that the balance sheet remains a work in progress.
In a statement regarding the upgrade, Northland analysts highlighted the company's performance in the previous year and expressed optimism for the current year. They project that Lending Tree will continue to experience growth in the Insurance domain and anticipate expansion in the Consumer sector. Moreover, they expect to see a slight improvement in the company's adjusted EBITDA margins.
The analysts' positive outlook for Lending Tree in 2025 is based on the company's strategic focus and recent financial developments. They believe that the company's efforts to grow and diversify its revenue streams, along with a more favorable margin profile, warrant a more optimistic stock rating.
Lending Tree, traded on NASDAQ under the ticker (NASDAQ:TREE), is poised to capitalize on these anticipated improvements. Northland's new price target represents their confidence in the company's potential for growth and profitability in the coming year.
Investors and market watchers will be keeping a close eye on Lending Tree's performance to see if the company can deliver on the growth and margin improvements that Northland anticipates. The upgraded rating and new price target reflect a belief in the company's ability to execute its business strategy effectively.
InvestingPro analysis suggests the stock is currently undervalued, with analyst targets ranging from $58 to $78. For deeper insights into Lending Tree's valuation and growth prospects, check out the comprehensive Pro Research Report, available exclusively to InvestingPro subscribers.
In other recent news, LendingTree, Inc., a leading online loan marketplace, has extended the contract of its CEO, Douglas R. Lebda, through December 31, 2025, and increased his base salary from $750,000 to $800,000. This move, approved by the company's Board of Directors, reflects LendingTree's commitment to retaining its top leadership.
In addition to leadership changes, LendingTree reported a 23% year-over-year increase in adjusted EBITDA to $27 million in its third quarter 2024 earnings call, with a record $41 million in Variable Marketing Margin driven by a 210% growth in auto insurance quotes revenue. The company's consumer business and home segment also saw revenue increases of 6% and 5% respectively.
Despite seasonal declines anticipated in Q4, LendingTree reported strong performance across all segments in October. On the financial front, the company faced challenges with a negative earnings per share of -$2.77 over the last twelve months, but analysts have revised their earnings upwards for the upcoming period. These are among the recent developments for LendingTree.
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