LendingTree Shares Hit 52-Week Low: How to Approach the Stock Now?

Core Insights - LendingTree, Inc. (TREE) shares have fallen to a 52-week low of $32.97, closing at $33.24, marking a 52.3% decline over the past six months compared to the industry's 18.3% decline [1][7] - The recent drop in stock price is attributed to new U.S. tariffs of 10% on imported goods, raising operational costs and potentially reducing loan demand and profitability for companies in the lending sector [2][7] - The company's liquidity position is weak, with $68.6 million in cash against long-term debt of $383.4 million, raising concerns about its ability to meet obligations [5] - Despite challenges, the company has shown strong revenue growth in its Insurance segment, with a CAGR of 13.4% over the past four years, and expects total revenues of $1.08–1.09 billion for 2025 [10][12] Price Performance - TREE shares have underperformed compared to peers like CNFinance Holdings Limited (CNF) and Rocket Companies, Inc. (RKT) [1][7] - The stock is currently trading at a trailing P/E ratio of 10.55X, which is lower than the industry average of 18.63X, indicating it may be undervalued [16] Operational Challenges - Rising costs persist despite cost-control efforts, with expenses continuing to increase in the first nine months of 2025 due to restructuring, severance, and marketing costs [8] - The company's capital distribution strategy, including stock repurchase programs, appears unsustainable given its current financial position [6] Long-Term Prospects - The company is diversifying its revenue streams by expanding non-mortgage products in the Consumer segment, including credit cards and personal loans [11] - Earnings per share are projected to grow by 50.16% over the next three to five years, outperforming the industry growth of 40.96% [12]