Lendingtree (TREE) AI Stock Analysis

• Market Cap: $690.31M
• Dividend Yield: N/A
• Average Volume (3M): 258.05K
• Price to Earnings (P/E): ―
• Beta (1Y): 2.33
• Revenue Growth: 33.86%
• EPS Growth: 66.85%
• Country: US
• Employees: 927
• Sector: Financial
• Sector Strength: 85
• Industry: Financial - Conglomerates
• EPS (TTM): -3.14
• Shares Outstanding: 13,393,620
• 10 Day Avg. Volume: 262,659
• 30 Day Avg. Volume: 258,049
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.77
• Price to Cash Flow (P/CF): 10.70
• P/FCF Ratio: 12.90
• Enterprise Value/Market Cap: 1.40
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: 1.12
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $66.57
• Price Target Upside: 27.75% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 7

LendingTree's overall score reflects a challenging financial backdrop with high leverage and negative profitability. The positive momentum from technical indicators and strong earnings call sentiment provide some optimism. However, valuation concerns due to a negative P/E ratio and lack of dividend yield limit the upside potential.

Positive Factors

Financial Performance

TREE posted 4Q results which came in above Street expectations on both the top line and EBITDA, as all three segments contributed to the revenue upside.

Outlook

TREE provided a solid outlook for both 1Q and FY25, calling for double-digit growth in the consumer, home, and insurance segments.

Negative Factors

Cost Concerns

Rising CAC is worth keeping an eye on.

Valuation

The price target is lowered to $65 to reflect the lower valuations.

Lendingtree Business Overview & Revenue Model

Company Description

LendingTree, Inc., through its subsidiary, LT Intermediate Company, LLC, operates online consumer platform in the United States. It operates through three segments: Home, Consumer, and Insurance. The Home segment offers purchase mortgage, refinance mortgage, reverse mortgage, and home equity loans; lines of credit; and real estate brokerage services. The Consumer segment provides credit cards; personal, small business, student, and auto loans; deposit accounts; and other credit products, such as credit repair and debt settlement services. The Insurance segment includes information, tools, and access to insurance quote products, including home and automobile, through which consumers are matched with insurance lead aggregators to obtain insurance offers. LendingTree, Inc. also operates Student Loan Hero, a personal finance website dedicated to helping student loan borrowers manage their student debt; QuoteWizard.com, a marketplace for insurance comparison; ValuePenguin, a personal finance website that offers consumers objective analysis on various financial topics from insurance to credit cards; and Stash, a consumer investing and banking platform that offers a suite of personal investment accounts, traditional and Roth IRAs, custodial investment accounts, and banking services, including checking accounts and debit cards with a Stock-Back rewards program. The company was formerly known as Tree.com, Inc. and changed its name to LendingTree, Inc. in January 2015. LendingTree, Inc. was incorporated in 1996 and is headquartered in Charlotte, North Carolina.

How the Company Makes Money

LendingTree generates revenue primarily through fees paid by lenders and financial institutions for the consumer leads and data provided by the platform. The company earns a substantial portion of its income from lead generation services, where lenders pay for access to potential customers interested in their financial products. Additionally, LendingTree earns revenue from advertising and marketing services offered to financial service providers. Significant partnerships with banks, credit unions, and other financial institutions contribute to its earnings by expanding the range of products and services available to consumers on its platform. The company also benefits from its strong brand recognition and digital marketing expertise, which help attract and retain a large user base.

Lendingtree Financial Statement Overview

Summary

LendingTree faces profitability challenges with a negative net profit margin despite revenue recovery. High debt levels and inconsistent EBIT/EBITDA margins add financial risk, though cash flow management shows improvement.

Income Statement

Lendingtree has faced declining revenue trends, with a notable decrease from 2021 to 2023. Despite a positive turnaround in 2024 with a revenue increase, the net profit margin remains negative due to ongoing losses, indicating profitability challenges. Gross profit margins are relatively high, suggesting potential for profitability if operational efficiencies improve. However, historical EBIT and EBITDA margins have been inconsistent, reflecting volatility in core operations.

Balance Sheet

The balance sheet shows a high level of debt relative to equity, with a debt-to-equity ratio that has increased over recent years, reaching 3.8 in 2024. This high leverage poses financial risks. Return on equity is negative due to net losses, and the equity ratio has declined, indicating reduced financial stability. The company has consistently reduced its stockholders’ equity, which could be concerning for investors.

Cash Flow

Operating cash flow remains positive, but the trend shows decreasing free cash flow growth, with a significant drop in 2024. The free cash flow to net income ratio is positive due to better cash management, despite net losses. There is a strong operating cash flow to net income ratio, suggesting good cash generation capability relative to reported losses. However, consistent negative net income affects overall cash flow strength.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
900.22M	672.50M	984.99M	1.10B	909.99M
	Gross Profit
864.15M	633.74M	927.22M	1.04B	855.50M
	EBIT
44.63M	-40.61M	-24.50M	123.50M	-1.55M
	EBITDA
73.12M	21.86M	17.05M	60.88M	53.25M
	Net Income Common Stockholders
-33.06M	-122.40M	-187.95M	69.11M	-22.57M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
106.59M	112.05M	298.85M	251.23M	169.93M
	Total Assets
767.67M	802.76M	1.20B	1.30B	1.19B
	Total Debt
413.36M	611.15M	912.76M	740.32M	703.77M
	Net Debt
306.77M	499.10M	613.92M	489.09M	533.84M
	Total Liabilities
658.85M	678.63M	991.37M	851.36M	824.23M
	Stockholders Equity
108.82M	124.13M	207.94M	447.99M	364.76M
Cash Flow		Free Cash Flow
51.04M	55.04M	31.52M	99.51M	-3.58M
	Operating Cash Flow
62.26M	67.57M	42.97M	134.57M	38.57M
	Investing Cash Flow
-11.22M	-12.48M	-27.88M	10.07M	-122.15M
	Financing Cash Flow
-56.50M	-242.01M	32.67M	-56.96M	193.29M

Lendingtree Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 52.11
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TREE, the sentiment is Positive. The current price of 52.11 is above the 20-day moving average (MA) of 46.54, above the 50-day MA of 46.30, and above the 200-day MA of 48.19, indicating a bullish trend. The MACD of 0.58 indicates Negative momentum. The RSI at 60.57 is Neutral, neither overbought nor oversold. The STOCH value of 95.27 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TREE.

Lendingtree Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EQBK	72 Outperform	$622.26M	8.89	11.84%	1.49%	40.43%	545.45%
Sector *	63 Neutral	$12.38B	9.57	7.87%	79.17%	12.62%	-4.94%
CRD.B	58 Neutral	$517.73M	19.17	17.80%	2.66%	2.79%	-13.37%
TREE	56 Neutral	$690.31M	―	-35.80%	―	33.86%	66.85%
HIPO	55 Neutral	$609.00M	―	-10.95%	―	77.44%	85.53%
LDI	48 Neutral	$354.54M	―	-31.41%	―	3.76%	16.19%
CIFR	47 Neutral	$1.14B	―	-7.61%	―	19.26%	-14.10%

Lendingtree Corporate Events

LendingTree Appoints Scott Totman to Lead AI Lab

On February 26, 2025, LendingTree announced that Scott Totman will transition to a new role on March 7, 2025, focusing on guiding the company’s AI efforts in its AI Lab. This move indicates a strategic emphasis on AI development, potentially impacting the company’s operations and market positioning.