Lendingtree Inc (TREE) Shares Plunge After Caution Comments on Mortage Originations


It’s been quite a rollercoaster ride for Lendingtree Inc (NASDAQ:TREE) shareholders this afternoon as the stock has dropped significantly after starting the day up quite a bit. After the company raised their revenue guidance for the fourth quarter and their full year 2015 guidance to $252.5 – $253.5 million from $244 – $247 million, one would have thought that the market would react quite nicely. This was the case as the market opened and the stock immediately jumped to nearly $90 a share. From that point forward, however, shares of Lendingtree Inc (NASDAQ:TREE) saw a steady decline, reaching as low as $62.54 before bouncing back a bit over the last hour.

The cause of the decline may have to do with comments related to mortgage originations coming out of the company’s presentation at the Needham Conference. There seems to be an overreaction, however, especially since Needham & Company has raised their price target to $140. SunTrust has also made a statement in which they defended the stock and said that no news has justified this drop in price.

The stock is down 23.18% or $20.08 following the news, hitting $66.55 per share. About 2.91 million shares traded hands or 469.68% up from the average. TREE has risen 36.34% since June 9, 2015 and is uptrending. It has outperformed the S&P500 by 43.82%.

From a total of 7 analysts covering LendingTree (NASDAQ:TREE) stock, 7 rate it a “Buy”, 0 a “Sell”, and 0 a “Hold”. This means that 100% of the ratings are positive. The highest target price is $150 while the lowest target price is $108. The mean of all analyst targets is $143.67 which is 115.88% above today’s ($66.55) stock price. LendingTree was the topic of 10 analyst reports since August 4, 2015 according to the firm StockzIntelligence Inc. Bank of America upgraded shares on December 10 to a “Buy” rating. Bank of America initiated shares with a”Neutral” rating and a $122 target share price in their report from a November 18. Guggenheim initiated TREE stock in a recent report from November 16 with a “Buy” rating. Finally, RBC Capital Markets initiated the stock with a “Outperform” rating in a report they issued on a November 9.

The institutional sentiment increased to 1.46 in Q2 2015. It’s up 0.33, from 1.13 in 2015Q2. The ratio increased, as 16 funds sold all their Lendingtree Inc shares they owned while 47 reduced their positions. 53 funds bought stakes while 39 increased their total positions. Institutions now own 5.42 million shares which is 41.29% less than the previous share count of 9.23 million in 2015Q2.

G2 Investment Partners Management Llc holds 13.65% of its total portfolio in Lendingtree Inc, equating to 392,914 shares. Timpani Capital Management Llc owns 94,457 shares representing 3.54% of their total US portfolio. Moreover, P.A.W. Capital Corp has 3.2% of their total portfolio invested in the company, equating to 30,000 shares. The Pennsylvania-based Emerald Mutual Fund Advisers Trust has a total of 1.67% of their portfolio invested in the stock. Emerald Advisers Inc Pa, a Pennsylvania-based fund reported 246,603 shares owned.

LendingTree, Inc. , formerly Tree.com, Inc. is engaged in operating an online loan marketplace for clients an array of loan types and other credit offerings. The company has a market cap of $831.66 million. The Firm offers clients tools and resources, including free credit scores, which help them to comparison-shop for mortgage loans, home equity loans and lines of credit, reverse mortgages, personal loans, auto loans, student loans, credit cards, small business loans and other related offerings. It has 38.11 P/E ratio. And, upon submitting their relevant information to the Company through an inquiry form, it seeks to match in-market clients with multiple lenders on its marketplace.