Is Lending Tree Stock Worth Investing Ahead of Its Q1 Earnings?

Core Viewpoint - LendingTree, Inc. (TREE) is expected to report year-over-year growth in revenues and earnings for the first quarter of 2025, with a consensus estimate of 74 cents per share and revenues of $244 million, reflecting increases of 5.7% and 45.3% respectively [4][5]. Financial Performance - In the last reported quarter, TREE's adjusted net income per share exceeded the Zacks Consensus Estimate, driven by revenue growth, although total costs increased [2]. - TREE has a strong earnings surprise history, beating estimates in three of the last four quarters with an average surprise of 64.76% [2]. Revenue Estimates - The consensus estimate for TREE's first-quarter 2025 revenues is $244 million, indicating a year-over-year rise of 45.3% [5]. - The Home segment is expected to generate revenues of $35 million, a 16.7% increase year-over-year [8]. - The Consumer segment is projected to see revenues of $57 million, suggesting a 9.6% year-over-year rise [10]. - The Insurance segment is anticipated to achieve revenues of $152.7 million, reflecting a significant year-over-year surge of 77.8% [12]. Growth Drivers - TREE is well-positioned for growth, with strong performance in the Insurance segment and increasing traction in the Consumer and Home segments [6]. - The demand for home equity loans has been robust, contributing to sustained growth [7]. - The Consumer segment is expected to benefit from stabilization in credit markets and ongoing platform migrations aimed at enhancing user experience [9][10]. - Management anticipates continued strong underwriting profitability in the Insurance segment, which should drive consumer spending [11]. Strategic Initiatives - TREE is diversifying its revenue sources by expanding non-mortgage product offerings, including personal, auto, small business, and student loans [21]. - The company has completed acquisitions totaling over $1 billion, enhancing its credit services and online lending platform [22]. - Cost-containment efforts, including headcount reduction and elimination of less profitable businesses, are expected to support bottom-line growth [23]. Valuation - TREE's stock is currently trading at a forward price-to-book ratio of 6.41, above its median level of 4.22 and the industry average of 3.92 [19].