Earnings reports hold a lot of power over the direction a company takes in the future. If a business posts a lower-than-expected earnings report, there’s a high chance investors might pull back the reins for a little while. What happened to San Francisco-based LendingClub (NYSE:LC) on Tuesday was not much different. However, this time, there’s a twist.
What Happened Yesterday With LendingClub?
On Tuesday, LendingClub posted its quarter four 2017 earnings report. It also reported full-year earnings for 2017 and provided shareholders with guidance for Q1 2018. Despite having impressive numbers in terms of face value, LendingClub still ended Tuesday’s trading session trading at all-time lows. So, what happened? Well, most of it can be traced back to the fact that LendingClub underperformed expectations.
The online marketplace was seen trading as low as $3.20 yesterday. For perspective, the company has been trading between a low of $3.20 and a high of $6.56 throughout the past 52 weeks. That means, as of yesterday, LendingClub was trading 51% below that high. Not to worry, however – things appear to be getting better.
What Happened Today?
While it’s still too early to tell if the green LendingClub’s stock is seeing today is guaranteed to last the entire trading session, I’m sure the company’s management team is still feeling a sense of relief. Why? Because currently, the LendingClub stock is trading up more than 15% on the New York Stock Exchange.
Talk about a turn-around. Maybe it’s because investors have had time to think more about LendingClub’s earnings report. After all, the online marketplace, which is one of the largest in the world, did generate record revenues. Additionally, LendingClub improved the bottom line quarterly adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) numbers around $20M. To top it off, LendingClub’s guidance for 2018 was reasonable. I mean, sure, the company may have experienced misses and disappointed with flat sequential numbers, but I would still consider the above a win.
Perhaps investors are starting to develop the same mentality. Today, LendingClub opened the trading day at $3.14. Now, the company is trading at $3.69. This puts the LC stock up $0.54, or 17.14%. It can be seen moving up and down a few cents every second or so.
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The Takeaway
The thing about the stock market is that nothing is ever a guarantee. For the sake of the company, I hope that the stock will continue to climb tomorrow and next week. However, there’s a chance that it won’t – we just have to wait and see.
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