LendingClub (LC) Stock Forecast & Price Target

LendingClub Corp is poised for growth, supported by a robust personal loan market that has experienced a 14% CAGR over the past 15 years, driving projected originations to increase by 32% year-over-year in 2025. The company anticipates notable earnings growth, with EPS expected to rise by approximately 150% this year and further operating leverage gains expected to drive margin expansions of 260 and 390 basis points in 2026 and 2027, respectively. Additionally, LendingClub’s significant focus on credit card debt consolidation positions it to capitalize on market opportunities amid tightening underwriting standards, further enhancing its financial performance and capital generation potential.

The negative outlook on LendingClub's stock is primarily driven by credit provisions falling 4% below consensus, with net charge-off (NCO) rates at 2.85%, considerably lower than the long-term underwriting target of 4.5%-5.0%. Additionally, the continued constraint in marketplace lending is likely to hinder earnings per share (EPS) performance, compounded by significantly reduced origination volumes compared to two years ago, which has forced the company to adopt a more cautious approach to credit underwriting. Furthermore, the company's market share has diminished from approximately 10% to the mid-single digits, reflecting the ongoing portfolio stress from prior lending vintages and posing challenges in sourcing new customers effectively.