SLM (NASDAQ:SLM) versus LendingTree (NASDAQ:TREE) Head to Head Review

LendingTree (NASDAQ:TREE) and SLM (NASDAQ:SLM) are both finance companies, but which is the superior stock? We will contrast the two companies based on the strength of their analyst recommendations, risk, earnings, profitability, dividends, valuation and institutional ownership.

Insider and Institutional Ownership

68.3% of LendingTree shares are owned by institutional investors. Comparatively, 98.9% of SLM shares are owned by institutional investors. 4.0% of LendingTree shares are owned by company insiders. Comparatively, 1.4% of SLM shares are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock will outperform the market over the long term.

Earnings & Valuation

This table compares LendingTree and SLM”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
LendingTree	$1.12 billion	0.34	$151.31 million	$12.90	2.08
SLM	$2.63 billion	1.86	$744.85 million	$3.58	7.27

SLM has higher revenue and earnings than LendingTree. LendingTree is trading at a lower price-to-earnings ratio than SLM, indicating that it is currently the more affordable of the two stocks.

Analyst Ratings

This is a summary of current recommendations for LendingTree and SLM, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
LendingTree	0	2	5	0	2.71
SLM	1	6	5	0	2.33

LendingTree currently has a consensus target price of $61.33, suggesting a potential upside of 128.69%. SLM has a consensus target price of $29.80, suggesting a potential upside of 14.44%. Given LendingTree’s stronger consensus rating and higher possible upside, equities analysts plainly believe LendingTree is more favorable than SLM.

Risk and Volatility

LendingTree has a beta of 2.05, indicating that its stock price is 105% more volatile than the S&P 500. Comparatively, SLM has a beta of 0.96, indicating that its stock price is 4% less volatile than the S&P 500.

Profitability

This table compares LendingTree and SLM’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
LendingTree	14.33%	14.57%	4.49%
SLM	26.09%	33.81%	2.51%

Summary

SLM beats LendingTree on 7 of the 13 factors compared between the two stocks.

About LendingTree

LendingTree, Inc., through its subsidiary, operates online consumer platform in the United States. It operates through three segments: Home, Consumer, and Insurance. The Home segment offers purchase mortgage, refinance mortgage, and home equity loans and lines of credit; and real estate brokerage services. The Consumer segment provides credit cards; personal, small business, student, and auto loans; deposit accounts; and other credit products, such as debt settlement services. The Insurance segment includes information, tools, and access to insurance quote products, including home, automobile, and health and Medicare through which consumers are matched with insurance lead aggregators to obtain insurance offers and policies. In addition, the company offers QuoteWizard, a marketplace for insurance comparison; ValuePenguin, a personal finance website that offers consumers objective analysis on various financial topics from insurance to credit cards; and Stash, a consumer investing and banking platform that offers a suite of personal investment accounts, traditional and Roth IRAs, custodial investment accounts, and banking services, including checking accounts and debit cards with a Stock-Back rewards program. The company was formerly known as Tree.com, Inc. and changed its name to LendingTree, Inc. in January 2015. LendingTree, Inc. was incorporated in 1996 and is based in Charlotte, North Carolina.

About SLM

SLM Corporation, through its subsidiaries, originates and services private education loans to students and their families to finance the cost of their education in the United States. It is also involved in the provision of retail deposit accounts, including certificates of deposit, money market accounts, and high-yield savings accounts; and interest-bearing omnibus accounts. The company was formerly known as New BLC Corporation and changed its name to SLM Corporation in December 2013. SLM Corporation was founded in 1972 and is headquartered in Newark, Delaware.