LendingClub has been treading water for the past six months, recording a small loss of 4.7% while holding steady at $15.82. The stock also fell short of the S&P 500’s 5.1% gain during that period.
Given the weaker price action, is now a good time to buy LC? Or should investors expect a bumpy road ahead? Find out in our full research report, it’s free.
Why Are We Positive On LendingClub?
Pioneering peer-to-peer lending in the US before evolving into a digital bank, LendingClub (NYSE: LC) operates a marketplace that connects borrowers with lenders, offering personal loans, auto refinancing, and banking services.
1. Skyrocketing Revenue Shows Strong Momentum
A company’s long-term performance is an indicator of its overall quality. Any business can put up a good quarter or two, but the best consistently grow over the long haul.
Thankfully, LendingClub’s 25.7% annualized revenue growth over the last five years was incredible. Its growth beat the average financials company and shows its offerings resonate with customers.
Note: Quarters not shown were determined to be outliers, impacted by outsized investment gains/losses that are not indicative of the recurring fundamentals of the business.2. Outstanding Long-Term EPS Growth
We track the long-term change in earnings per share (EPS) because it highlights whether a company’s growth is profitable.
LendingClub’s full-year EPS flipped from negative to positive over the last five years. This is a good sign and shows it’s at an inflection point.
Final Judgment
These are just a few reasons LendingClub is a high-quality business worth owning. With its shares trailing the market in recent months, the stock trades at 8.6× forward P/E (or $15.82 per share). Is now a good time to initiate a position? See for yourself in our full research report, it’s free.
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