LendingTree, Inc. TREE is scheduled to report first-quarter 2025 results on May 1, after market close. The company’s results are expected to reflect year-over-year growth in revenues and earnings in the quarter to be reported.

TREE’s peer Onity Group Inc. ONIT is slated to announce the quarterly numbers on April 30, 2025, whereas Rocket Companies Inc. RKT will announce quarterly results on May 8.

In the last reported quarter, TREE’s adjusted net income per share surpassed the Zacks Consensus Estimate. The results were driven by a rise in revenues. However, an increase in total costs was a spoilsport.

LendingTree has a decent earnings surprise history. Its earnings beat the Zacks Consensus Estimate in three of the trailing four quarters and missed once, the average surprise being 64.76%. (See the Zacks Earnings Calendar to stay ahead of market-making news.)

Earnings Surprise History

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Let us check out how TREE is expected to fare in terms of revenues and earnings this time around. 

The Zacks Consensus Estimate for LendingTree’s first-quarter earnings of 74 cents per share has been unchanged over the past seven days. The figure indicates a 5.7% increase from the year-ago reported number.

The consensus estimate for revenues is pegged at $244 million, indicating a year-over-year rise of 45.3%. For the first quarter of 2025, TREE expects total revenues between $241 million and $248 million.

Key Factors & Estimates for TREE in Q1

TREE remains well-positioned with solid momentum following a strong fourth-quarter performance, driven by growth across all segments, with Insurance remaining the primary growth driver. Notably, the Consumer and Home segments are gaining traction, contributing to a more balanced growth outlook.

Within the Home segment, the demand for home equity loans was strong in the first quarter, and TREE is likely to have capitalized on it by expanding its lender network and improving unit economics. This is anticipated to have contributed to sustained growth in the quarter to be reported.

Mortgage rates in the first quarter of 2025 remained range-bound and hovered near the 7% mark. As such, refinancing activities and origination volumes witnessed decent growth. Hence, TREE is expected to have seen some increased activity in the mortgage segment in terms of originations and refinancing.

The Zacks Consensus Estimate for TREE’s Home segment’s first-quarter 2025 revenues is pegged at $35 million, indicating a year-over-year rise of 16.7%.

The Consumer segment is expected to see notable growth, particularly in small business and personal loans, as credit markets stabilize and lenders seek to capture incremental market share. Also, a significant portion of consumers are seeking personal loans to refinance expensive credit card debt. Further, LendingTree is in the middle of multiple platform migrations aimed at offering more personalized lender offers. This initiative is expected to improve user experience and drive higher conversion rates. Given these favorable factors, TREE’s Consumer segment is expected to have registered decent growth in the first quarter.

The Zacks Consensus Estimate for LendingTree’s Consumer segment’s first-quarter 2025 revenues is pegged at $57 million, suggesting a year-over-year rise of 9.6%.

Meanwhile, TREE’s Insurance segment is expected to have witnessed robust momentum due to continued strength in underwriting profitability. Management expects insurers to continue to see strong underwriting profitability throughout 2025 as they optimize policy rates and marketing costs to capture share in the competitive market, which should lead to increased consumer spending that would benefit the business.

These favorable factors, combined with TREE’s ongoing focus on enhancing its platform and strengthening partnerships, position the company to deliver solid growth across the segment in the quarter to be reported.

The Zacks Consensus Estimate for TREE’s Insurance segment’s first-quarter 2025 revenues is pegged at $152.7 million, implying a year-over-year surge of 77.8%.

What the Zacks Model Reveals for LendingTree

Our proven model does not conclusively predict that TREE will beat the Zacks Consensus Estimate this time around. This is because the company does not have the right combination of the two key ingredients — a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) — to increase the odds of an earnings beat.

You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Earnings ESP: LendingTree has an Earnings ESP of 0.00%.

Zacks Rank: TREE currently carries a Zacks Rank of 1.

TREE’s Price Performance & Valuation

Lending Tree outperformed the industry in the first quarter of 2025. Its peers Onity Group and Rocket Companies also outperformed the industry in the same time frame.

Price Performance

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Let us look at the value TREE offers investors at present.

Currently, the TREE stock is trading at 6.41X forward 12 months price/book TTM (P/B), above its median level of 4.22X and the industry’s P/TB TTM multiple of 3.92X. The company’s valuation looks somewhat expensive compared with the industry average and its range.

Price-to-Book TTM

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Onity Group and Rocket Companies are trading at forward P/TB TTM multiples of 0.61X and 2.78X, respectively.

How to Play TREE Stock Now?

One of LendingTree's smartest moves is its shift from overreliance on mortgage lending — a sector prone to cyclical slumps. 
The company is committed to boosting revenues by diversifying its non-mortgage product offerings, particularly in the Consumer segment. Over the past years, the company has amplified its services, such as credit cards, and widened loan offerings to personal, auto, small business, and student loans. The company intends to continue adding offerings for consumers, small businesses and network partners to its online marketplace to grow and diversify its revenue sources. 

LendingTree has been benefiting from its acquisition spree. Over the years, the company has completed several deals for a total consideration value of more than $1 billion, including potential earnouts. The company has enhanced its credit services and credit card product offerings, and strengthened its online lending platform through acquisitions.

Further, the company’s cost-containment efforts include headcount reduction and the elimination of less profitable businesses. In sync with this, TREE is emphasizing the reduction of variable marketing margin, which reflects the efficiency of marketing expenditure. These strategic initiatives by LendingTree will likely support bottom-line growth in the upcoming period.

Hence, investors can consider investing in the TREE stock at its current level to generate healthy long-term returns.

TREE currently flaunts a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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