LendingTree Inc., an online marketplace connecting consumers with potential lenders, reported a 21 percent increase in fourth quarter profit Thursday that missed analyst expectations, causing its stock price to fall.
The Charlotte-based company reported a net income of $11.9 million, or 84 cents per share, compared to $9.8 million, or 77 cents per share, in the fourth quarter of 2016.
The results missed analyst estimates of 90 cents per share.
“We more than tripled our size in the strategically important and highly competitive credit card business,” CEO Doug Lebda said in a press release. “Our mortgage business grew 25 percent year-over-year in a category where originations were down 17 percent, according to industry estimates, further evidence of the value we provide for both borrowers and lenders in any environment.”
Through acquisitions of credit card price-comparison services CompareCards and MagnifyMoney in 2017, the company stated credit card revenue grew 35 percent in the quarter to $36.9 million.
Revenue contributions from the company’s My LendingTree service, which allows customers to sign up for free credit scores and savings alerts, rose 109 percent compared to the previous year’s quarter.
LendingTree’s overall revenue grew nearly 60 percent to $161 million, beating analyst expectations of $150.2 million.
It also stated a $9.1 million loss due to changes in the new tax law. Along with that, the company spent $10 million as a one-time commitment to establish a charitable foundation.
LendingTree also provided projections for first quarter 2018 revenue, anticipating between $170 million and $175 million. That would be a 28 to 32 percent improvement on first quarter 2017.
That matches Wall Street expectations, with analysts projecting revenue for the quarter of $171.93 million and $1.10 in earnings per share.
On Wednesday, the company’s board of directors approved an additional $110 million in repurchasing of shares.
With fourth quarter earnings per share missing analyst expectations, LendingTree’s stock dropped $30.50 from close of the Wednesday before earnings were reported. Its shares were trading at $340.75 Friday near close.
The filing can be found here.
