Lendingtree (TREE) just hit a new all-time high as strong earnings this week have propelled shares of TREE stock about 30% in just a few days.
So I hope you took my advice on July 30, then, and bought Lendingtree stock in advance of this report.
The details, if you missed them, are quite powerful. Lending Tree reported record revenue that was up 31% year-over-year, led by a boom in personal loans. The strong performance also led TREE stock to increase its full-year guidance for fiscal 2015 as a result.
As I wrote previously, Lendingtree is the real deal and isn’t one of those “fintech” startups bleeding cash as it struggles to connect with customers. In addition to being firmly profitable, TREE stock also has been public since before the Great Recession and there is plenty of earnings history and financial documentation to dig into and prove its staying power.
This small-cap stock is a huge winner right now thanks to both its dominance as an online lending marketplace and the cyclical recovery in consumer spending trends. Loans for cars, mortgages, student loans and the like have increasingly been in demand as American households start feeling better — and that naturally boosts TREE stock as a result.
I really like this company. Yes, there is risk of a pullback should the mortgage environment cool off in the near term. But Lendingtree is working hard to diversify operations into other loan types, growing its non‐mortgage operations business revenue from about 11% in 2013 to 32% as of the latest LendingTree earnings. That’s an encouraging trend.
Personal loans in particularly continue to be a bright spot, as evidenced by the nearly 400% growth year-over-year in this segment.
Sentiment is strongly in favor of TREE stock, with shares up over 320% in the past year. This is a company that is forging ahead with a new financial model for the digital age that should continue to connect with consumers and investors alike.
LendingTree is admittedly a bit frothy after this report, but I really like what this company has to offer. It could very well become the Priceline.com (PCLN) of the lending biz, connecting consumers to loans via transparency and a greater value proposition, and these gains may only be the beginning.
Jeff Reeves is the editor of InvestorPlace.com and the author of The Frugal Investor’s Guide to Finding Great Stocks. Write him at editor@investorplace.com or follow him on Twitter via @JeffReevesIP. As of this writing, he did not hold a position in any of the aforementioned securities.
