Finance

What Recent Ownership Trends Suggest About LendingClub Corporation (LC)’s Future Performance

Recent insider trends for LendingClub Corporation (NYSE:LC) have caught the attention of investors. Insider data is useful because it can reveal what a company’s executives and largest shareholders feel about a stock. In this case, the data has some interesting things to say about how LC might perform in the future.

Institutions own 85.38% of LendingClub Corporation (LC)’s shares. The total value of these holdings, in millions, is $2,252. Among active positions in the latest quarter, 96 holders increased their positions by a total of 29.64 million shares, 74 holders decreased the positions by a total of 27.98 million shares, and 38 holders held their positions. This works out to a net increase in ownership of 1.66 million shares, and suggests that institutions are feeling bullish about the stock.

Among new and sold out positions, 25 holders initiated new positions by a total of 5.35 million shares and 21 holders exited their positions by a total of 5.52 million shares. This nets out to a decrease of 170640 shares and is another bearish sign for LC.

In the last three months, insiders executed a total of 14 trades. 3 of these were buys and 11 were sells. Insider ownership decreased by a total of 131337 shares, which suggests that LC’s key executives are feeling less optimistic about the outlook for the stock. The data from the past twelve months tells a similar story: insiders executed 11 buys and 58 sells, and ownership decreased by a net of 14.96 million shares.



Analysts often look at short interest, or the number of shares currently being shorted by investors, to aid in their outlook for a particular stock. LendingClub Corporation (NYSE:LC)’s short interest is 36.27 million shares, or % of the float. This represents an increase of 1% in the number of shares being shorted compared to the previous reading, and implies that investors felt more pessimistic about the stock during the past two weeks.

Given what the insider ownership patterns are saying, it makes sense to consider the technicals to see if these pieces of information reach the same conclusion about the outlook for LC. A composite of 13 technical indicators that includes measures such as moving averages and momentum oscillators suggests that LC is a Strong buy, which implies that LC is expected to outperform the market based on prior trading patterns.

Conclusion




Institutional ownership trends suggest that the stock is cheap and the insider trading data indicates that insiders are bearish. Technical indicators (also) suggest that LendingClub Corporation (NYSE:LC) is undervalued.

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