LendingClub shares plunge on proposal to tighten lending

LendingClub Corp. (NYSE:LC) reported in line third quarter results but its shares plunged 20% in early trade after the company announced that it plans to tighten its lending to only the most creditworthy borrowers.

Its shares were off 20.51% at US$4.3399. 

The company, the largest US online marketplace which connects borrowers and investors, also lowered its guidance on 2017 revenue to US$576mln – US$581mln, from earlier estimates of US$585mln – US$600mln.

For the full year, analysts’ consensus is for revenue of US$590.9mln and EPS of 3 US cents.

The company, in a statement, also gave a narrower GAAP net loss range of US$69mln – US$65mln from the earlier guidance of US$69mln – US$61mln.

In the quarter, the company said net revenue hit a record high of US$154mln, up 34% year-on-year, but still off consensus forecast for US$157mln.

Story by ProactiveInvestors