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Lending Tree (TREE) Q4 Earnings Beat, Down on Revenue Decline
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Lending Tree, Inc. (TREE - Free Report) reported an adjusted net income per share of 38 cents in the fourth quarter of 2022. The Zacks Consensus Estimate was pegged at a loss of 27 cents. The reported figure compares favorably with an adjusted net loss of 31 cents reported in the prior-year quarter.
The stock lost 13.6% following the release of the results, reflecting a bearish reaction by the investors. The company’s results were aided by lower costs, while a decline in revenues was a spoilsport. TREE provided encouraging 2023 guidance.
LendingTree reported a net loss from continuing operations of $10.4 million or 81 cents per share against an income of $48.4 million or $3.67 per share reported in the year-ago quarter.
For 2022, the adjusted net income per share was $1.07, which declined from $1.40 reported in the prior year.
Revenues Decline, Expenses Fall
Total revenues were down 21.8% year over year to $202.1 million in the fourth quarter. The downside primarily stemmed from a decline in the Home and Consumer segment, personal loan and credit card revenues partially offset by Home Equity revenues. Also, the reported figure missed the Zacks Consensus Estimate of $206.4 million.
For 2022, total revenues of $985 million decreased 10.3% year over year.
The total cost of revenues was $13.5 million, down 4.1% from the prior-year quarter. Also, there was a decline in all components of expenses except restructuring and severance, interest expenses as well as litigation settlements and contingencies expenses.
In 2022, adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) totaled $84.5 million, down 37.3% year over year. The variable marketing margin was at $337.7 million, down 11.6%.
As of Dec 31, 2022, cash and cash equivalents were $298.8 million, up 19% year-over-year. Long-term debt was $813.5 million, up 70.1%. Total shareholders' equity was $207.9 million, down 53.6%.
Outlook
For the first quarter of 2023, total revenues are estimated to be between $200 million and $210 million. Adjusted EBITDA and the variable marketing margin are anticipated in the range of $11-$16 million and $76-$81 million, respectively.
For 2023, total revenues are estimated to be between $935 million and $985 million. Adjusted EBITDA is anticipated to be in the range of $85-$95 million. The variable marketing margin is expected to be between $325 million and $350 million.
Conclusion
The company’s total revenues were affected mainly by the decline in Home and Consumer segment revenues. Nonetheless, the company remained focused on maintaining the balance between near-term profitability and aligning it for long-term success.
LendingTree, Inc. Price, Consensus and EPS Surprise
Charles Schwab’s (SCHW - Free Report) fourth-quarter 2022 adjusted earnings of $1.07 per share missed the Zacks Consensus Estimate of $1.10. The bottom line, however, soared 24% from the prior-year quarter.
Results benefited from higher rates, which led to a rise in net interest income. Thus, revenues witnessed an improvement despite higher volatility hurting trading income. Also, the absence of fee waivers and solid brokerage account numbers acted as tailwinds during the quarter. However, higher expenses were headwinds.
Interactive Brokers Group’s (IBKR - Free Report) fourth-quarter 2022 adjusted earnings of $4.21 per share surpassed the Zacks Consensus Estimate of $4.00. The bottom line reflects a substantial jump from $1.63 in the prior-year quarter.
Results benefited from an improvement in revenues and lower expenses. However, IBKR recorded a decline in brokerage and advisory assets, which hurt the results to some extent.
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Lending Tree (TREE) Q4 Earnings Beat, Down on Revenue Decline
Lending Tree, Inc. (TREE - Free Report) reported an adjusted net income per share of 38 cents in the fourth quarter of 2022. The Zacks Consensus Estimate was pegged at a loss of 27 cents. The reported figure compares favorably with an adjusted net loss of 31 cents reported in the prior-year quarter.
The stock lost 13.6% following the release of the results, reflecting a bearish reaction by the investors. The company’s results were aided by lower costs, while a decline in revenues was a spoilsport. TREE provided encouraging 2023 guidance.
LendingTree reported a net loss from continuing operations of $10.4 million or 81 cents per share against an income of $48.4 million or $3.67 per share reported in the year-ago quarter.
For 2022, the adjusted net income per share was $1.07, which declined from $1.40 reported in the prior year.
Revenues Decline, Expenses Fall
Total revenues were down 21.8% year over year to $202.1 million in the fourth quarter. The downside primarily stemmed from a decline in the Home and Consumer segment, personal loan and credit card revenues partially offset by Home Equity revenues. Also, the reported figure missed the Zacks Consensus Estimate of $206.4 million.
For 2022, total revenues of $985 million decreased 10.3% year over year.
The total cost of revenues was $13.5 million, down 4.1% from the prior-year quarter. Also, there was a decline in all components of expenses except restructuring and severance, interest expenses as well as litigation settlements and contingencies expenses.
In 2022, adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) totaled $84.5 million, down 37.3% year over year. The variable marketing margin was at $337.7 million, down 11.6%.
As of Dec 31, 2022, cash and cash equivalents were $298.8 million, up 19% year-over-year. Long-term debt was $813.5 million, up 70.1%. Total shareholders' equity was $207.9 million, down 53.6%.
Outlook
For the first quarter of 2023, total revenues are estimated to be between $200 million and $210 million. Adjusted EBITDA and the variable marketing margin are anticipated in the range of $11-$16 million and $76-$81 million, respectively.
For 2023, total revenues are estimated to be between $935 million and $985 million. Adjusted EBITDA is anticipated to be in the range of $85-$95 million. The variable marketing margin is expected to be between $325 million and $350 million.
Conclusion
The company’s total revenues were affected mainly by the decline in Home and Consumer segment revenues. Nonetheless, the company remained focused on maintaining the balance between near-term profitability and aligning it for long-term success.
LendingTree, Inc. Price, Consensus and EPS Surprise
LendingTree, Inc. price-consensus-eps-surprise-chart | LendingTree, Inc. Quote
Currently, LendingTree carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Finance Stocks
Charles Schwab’s (SCHW - Free Report) fourth-quarter 2022 adjusted earnings of $1.07 per share missed the Zacks Consensus Estimate of $1.10. The bottom line, however, soared 24% from the prior-year quarter.
Results benefited from higher rates, which led to a rise in net interest income. Thus, revenues witnessed an improvement despite higher volatility hurting trading income. Also, the absence of fee waivers and solid brokerage account numbers acted as tailwinds during the quarter. However, higher expenses were headwinds.
Interactive Brokers Group’s (IBKR - Free Report) fourth-quarter 2022 adjusted earnings of $4.21 per share surpassed the Zacks Consensus Estimate of $4.00. The bottom line reflects a substantial jump from $1.63 in the prior-year quarter.
Results benefited from an improvement in revenues and lower expenses. However, IBKR recorded a decline in brokerage and advisory assets, which hurt the results to some extent.