Why Shares of LendingClub Are Sinking Today

Shares of the online idiosyncratic lender and integer slope LendingClub (NYSE: LC) traded astir 13% lower, arsenic of 11:14 a.m. ET today. The institution reported its fourth-quarter 2025 net aft the marketplace closed yesterday and held a league telephone with Wall Street analysts.

LendingClub reported diluted net per stock (EPS) of $0.35 connected full gross of astir $267 million, driven by astir $2.6 cardinal successful indebtedness originations. All the numbers are importantly higher twelvemonth implicit year, and EPS and gross some bushed statement estimates.

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LendingClub besides guided for $2.6 cardinal successful originations and diluted EPS of $0.365 successful the archetypal 4th of 2026 astatine the midpoint of management's guidance. For the afloat year, absorption guided for $12.1 cardinal successful indebtedness originations and diluted EPS of $1.725, besides astatine the midpoint of management's guidance. This represents 48% year-over-year maturation successful diluted EPS and 26% maturation successful originations.

Interestingly, guidance for some the existent 4th and the afloat twelvemonth of 2026 exceeded Wall Street statement estimates. LendingClub is readying a important accounting alteration this quarter, successful which it volition people each of its loans arsenic held-for-sale (HFS). Previously, the institution accounted for a information of the loans arsenic held-for-investment (HFI).

Loans accounted for by HFS are marked to just worth each quarter, portion HFI loans are provisioned for imaginable aboriginal indebtedness losses upfront, which tin effect successful a seemingly much punitive charge. I'm guessing investors thought the accounting alteration mightiness pb to an adjacent amended guardant guidance than what absorption provided.

It volition apt instrumentality clip for the marketplace to digest LendingClub's caller accounting change, but the banal present trades astatine astir 10 times guardant earnings, contempt beardown growth. I deliberation this is an charismatic introduction point.

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