Trade-Ideas LLC identified LendingClub ( LC) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified LendingClub as such a stock due to the following factors:

  • LC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $82.4 million.
  • LC has traded 286,661 shares today.
  • LC is down 3.6% today.
  • LC was up 6.7% yesterday.

EXCLUSIVE OFFER: Get the inside scoop on opportunities in LC with the Ticky from Trade-Ideas. See the FREE profile for LC NOW at Trade-Ideas

More details on LC:

LendingClub Corporation, together with its subsidiaries, operates as an online marketplace that connects borrowers and investors in the United States. LC has a PE ratio of 253. Currently there are no analysts that rate LendingClub a buy, 2 analysts rate it a sell, and 8 rate it a hold.

The average volume for LendingClub has been 17.6 million shares per day over the past 30 days. LendingClub has a market cap of $1.7 billion and is part of the financial sector and financial services industry. Shares are down 57.9% year-to-date as of the close of trading on Wednesday.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates LendingClub as a sell. The company's weaknesses can be seen in multiple areas, such as its generally disappointing historical performance in the stock itself and generally high debt management risk.

Highlights from the ratings report include:
  • LC's stock share price has done very poorly compared to where it was a year ago: Despite any rallies, the net result is that it is down by 73.66%, which is also worse that the performance of the S&P 500 Index. Investors have so far failed to pay much attention to the earnings improvements the company has managed to achieve over the last quarter. Despite the heavy decline in its share price, this stock is still more expensive (when compared to its current earnings) than most other companies in its industry.
  • The debt-to-equity ratio is very high at 4.50 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Consumer Finance industry and the overall market, LENDINGCLUB CORP's return on equity significantly trails that of both the industry average and the S&P 500.
  • The gross profit margin for LENDINGCLUB CORP is rather high; currently it is at 57.14%. Regardless of LC's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, LC's net profit margin of 1.25% is significantly lower than the industry average.
  • Net operating cash flow has significantly increased by 53.05% to $9.94 million when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of 42.86%.

EXCLUSIVE OFFER: See inside Jim Cramer's multi-million dollar charitable trust portfolio to see the stocks he thinks could be potential winners. Click here to see his holdings for 14-days FREE.