LendingTree (NASDAQ:TREE – Get Free Report) and Freddie Mac (OTCMKTS:FMCC – Get Free Report) are both finance companies, but which is the better stock? We will contrast the two companies based on the strength of their profitability, institutional ownership, dividends, risk, earnings, analyst recommendations and valuation.
Earnings and Valuation
This table compares LendingTree and Freddie Mac”s gross revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| LendingTree | $900.22 million | 1.03 | -$41.70 million | ($4.06) | -16.71 |
| Freddie Mac | $122.05 billion | 0.05 | $11.86 billion | ($0.03) | -324.00 |
Profitability
This table compares LendingTree and Freddie Mac’s net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| LendingTree | -5.33% | 25.79% | 3.46% |
| Freddie Mac | 9.04% | -44.33% | 0.34% |
Institutional and Insider Ownership
68.3% of LendingTree shares are owned by institutional investors. 23.4% of LendingTree shares are owned by insiders. Comparatively, 0.1% of Freddie Mac shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.
Volatility and Risk
LendingTree has a beta of 1.69, meaning that its share price is 69% more volatile than the S&P 500. Comparatively, Freddie Mac has a beta of 2.1, meaning that its share price is 110% more volatile than the S&P 500.
Analyst Ratings
This is a breakdown of current ratings for LendingTree and Freddie Mac, as provided by MarketBeat.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| LendingTree | 0 | 1 | 6 | 2 | 3.11 |
| Freddie Mac | 1 | 0 | 0 | 0 | 1.00 |
LendingTree currently has a consensus price target of $65.38, indicating a potential downside of 3.63%. Freddie Mac has a consensus price target of $4.50, indicating a potential downside of 53.70%. Given LendingTree’s stronger consensus rating and higher probable upside, analysts clearly believe LendingTree is more favorable than Freddie Mac.
Summary
LendingTree beats Freddie Mac on 10 of the 15 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 Freddie Mac
Federal Home Loan Mortgage Corporation operates in the secondary mortgage market in the United States. It operates through two segments, Single-Family and Multifamily. The Single-Family segment purchases, securitizes, and guarantees single-family loans; and manages single-family mortgage credit and market risk, as well as manages mortgage-related investments portfolio, single-family securitization activities, and treasury functions. This segment serves mortgage banking companies, commercial banks, regional banks, community banks, credit unions, housing finance agencies, savings institutions, and non-depository financial institutions. The Multifamily segment engages in the purchase, securitization, and guarantee of multifamily loans; issuance of multifamily K certificates; manages multifamily mortgage credit and market risk; and invests in multifamily loans and mortgage-related securities. It serves banks and other financial institutions, insurance companies, money managers, hedge funds, pension funds, state and local governments, and broker dealers. Federal Home Loan Mortgage Corporation incorporated in 1970 and is headquartered in McLean, Virginia.
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