LendingTree ( TREE Quick Quote TREE - Free Report) appreciated 2%, following the release of second-quarter 2021 results. The company reported adjusted net income per share of 76 cents in the quarter, surpassing the Zacks Consensus Estimate of 19 cents. The reported figure was 65% higher than 46 cents reported in the prior-year quarter.
While the recovery in the company’s consumer segment business buoyed results, elevated expenses were spoilsports. Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) reflect a rise from the prior-year quarter.
The company reported GAAP net income of $9.8 million or 71 cents per share against a net loss of $8.6 million or 66 cents in the year-ago quarter.
Revenues Jump, Expenses Rise
Total revenues grew 47% year over year to $270 million in the second quarter. The upside primarily stemmed from higher consumer revenues. The reported figure, however, missed the Zacks Consensus Estimate of $271 million.
Total costs and expenses were $259.5 million, up 35% from the prior-year quarter. The upswing chiefly resulted from a rise in selling and marketing expenses, general and administrative expenses, cost of product development and depreciation costs.
Adjusted EBITDA totaled $38.2 million, up 24% year over year. Variable marketing margin came in at $98.4 million, up 19% year over year.
As of Jun 30, 2021, cash and cash equivalents were $203.2 million, up from $169.9 million as of Dec 31, 2020. Long-term debt was $465.9 million, down from the prior-year end of $611.4 million. Total shareholders' equity was $420.4 million, up from $364.8 million as of Dec 31, 2021.
Concurrent with the June-end quarter results, management issued third-quarter 2021 estimates.
Total revenues are estimated to be $285-$298 million. Adjusted EBITDA and variable marketing margin are anticipated to be $27-$31 million and $86-$92 million, respectively.
LendingTree put up a decent show in the second quarter in terms of earnings. Its declining dependence on mortgage-related sources of revenues and various acquisitions over the past several years is likely to continue aiding financials and help diversify revenues.
However, unsustainable capital-deployment activities and a rise in expenses are near-term headwinds.
Currently, LendingTree carries a Zacks Rank #4 (Sell).
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