Tree.com (TREE) Upgraded to Buy: What Does It Mean for the Stock?

Core Viewpoint - Tree.com (TREE) has been upgraded to a Zacks Rank 2 (Buy) due to an upward trend in earnings estimates, indicating a positive earnings outlook that may lead to increased stock price [1][3]. Earnings Estimates and Stock Price Movement - The change in a company's future earnings potential, as reflected in earnings estimate revisions, is strongly correlated with near-term stock price movements, influenced by institutional investors [4]. - For Tree.com, rising earnings estimates and the consequent rating upgrade signify an improvement in the company's underlying business, which is expected to drive the stock price higher [5]. Zacks Rating System - The Zacks Rank stock-rating system classifies stocks into five groups based on earnings estimates, with Zacks Rank 1 (Strong Buy) stocks generating an average annual return of +25% since 1988 [7]. - The Zacks rating system maintains an equal proportion of 'buy' and 'sell' ratings across its universe of over 4000 stocks, ensuring that only the top 20% receive favorable ratings [9][10]. Earnings Estimate Revisions for Tree.com - Tree.com is expected to earn $2.67 per share for the fiscal year ending December 2024, reflecting a year-over-year change of 17.1% [8]. - Over the past three months, the Zacks Consensus Estimate for Tree.com has increased by 24%, indicating a positive trend in earnings estimates [8].