Shares of LendingTree TREE are up more than 20 percent Wednesday following the company’s Q4 report which included raised guidance and a buyback expansion. In January CEO Doug Lebda told Benzinga he has, “never been more bullish on the future of the company.”
Benzinga caught up with Lebda following results this morning.
Continued Growth
LendingTree’s revenue is up 79 percent year over year, led by growth in both the mortgage and non-mortgage divisions. Non-mortgage revenue rose from $10.7 million to $31.4 million.
“What you are seeing is there are more lenders coming in and the more lenders coming in, that expresses higher demand.” Both mortgage and non-mortgage divisions are seeing growth.
Some have expressed concern for LendingTree’s mortgage business as the environment weakens. Lebda emphasised that even if the market slows, LendingTree’s growth will continue because the company still has a small amount of marketshare.
Expanded Buyback
Following a ~$100 million offering in November 2015, LendingTree announced a $50 million buyback in January and expanded the buyback by $40 million today.
When asked about the decision to buyback stock versus other uses of capital, Lebda emphasised the company is focused on investing its cash in the most effective way possible. “We always look at what our stock is worth using DCF and PE multiples... and figure out what our stock is actually worth. If we think our stock is a better investment than other options, like M&A, we’re gonna deploy our money.
“Right now we think our stock is incredibly attractive. That said we still maintain enough dry powder to do acquisitions.”
Shares of LendingTree last traded at $84.55, up 20.9 percent for the day.
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