IRVINE, CA—Anthony Hsieh, a director and ten percent owner of loanDepot, Inc. (NYSE:LDI), recently sold shares of the company's Class A common stock, according to a filing with the Securities and Exchange Commission. Over two days, November 18 and 19, Hsieh sold a total of 364,529 shares at prices ranging from $2.332 to $2.4004 per share, amounting to a total value of approximately $863,772.
Following these transactions, Hsieh holds 6,845,600 shares indirectly through the JLSSAA Trust, where he has voting and investment power. Additionally, he maintains direct ownership of 73,781 shares.
These sales are part of Hsieh's ongoing management of his investment in loanDepot, a company he has been significantly involved with as both a director and major shareholder.
In other recent news, loanDepot reported a significant shift in its financial trajectory, bouncing back to profitability in the third quarter of 2024. The company announced an adjusted net income of $7 million, a remarkable recovery from a $29 million loss in the same quarter of 2023. This positive trend was accompanied by a 19% increase in pull-through weighted rate lock volume, reaching $6.7 billion, and an adjusted total revenue of $320 million, up from $261 million year-over-year.
loanDepot's CEO, Frank Martell, unveiled Project North Star, a strategic initiative designed to sustain revenue growth and enhance customer experiences. The company's CFO, David Hayes, projected a pull-through weighted lock volume between $5.5 billion and $7.5 billion for Q4 2024. These recent developments demonstrate loanDepot's strategic moves to capitalize on the recovery in the housing market.
Despite the overall return to profitability, loanDepot faced increased expenses due to higher commissions, marketing, and overtime costs. However, the successful completion of the Vision 2025 strategic program, with cost reductions exceeding $730 million, and the introduction of new products for first-time homebuyers, highlights the company's resilience and adaptability. The joint venture with Smith Douglas presents new market opportunities, further solidifying loanDepot's positive outlook for 2025.
InvestingPro Insights
Anthony Hsieh's recent sale of loanDepot, Inc. (NYSE:LDI) shares comes at a time when the company faces several challenges, as highlighted by InvestingPro data and tips. The stock has experienced significant volatility, with InvestingPro reporting a 10.42% decline in the past week alone. This aligns with the InvestingPro Tip that the "stock has taken a big hit over the last week" and "generally trades with high price volatility."
Despite the recent downturn, loanDepot's revenue growth shows some positive signs. The company reported a 25.96% quarterly revenue growth in Q3 2024, with total revenue reaching $1.01 billion over the last twelve months. However, profitability remains a concern. The company's operating income margin stands at -20.38%, and InvestingPro Tips indicate that analysts do not anticipate the company will be profitable this year.
The company's financial health also raises some red flags. An InvestingPro Tip warns that loanDepot is "quickly burning through cash," which could explain Hsieh's decision to sell a portion of his holdings. Additionally, the company does not pay a dividend to shareholders, potentially making it less attractive to income-focused investors.
For those interested in a deeper analysis, InvestingPro offers 11 additional tips for loanDepot, providing a more comprehensive view of the company's financial situation and market position. These insights could be valuable for investors trying to understand the context of Hsieh's stock sale and the company's future prospects.
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