To many, this would seem like picking on Barry Diller. Just a few days after closing off a trade on Google vs IAC Interactive, I am at it again, going long on Google against a company that was spun off from IACI. Tree.com was the consumer credit branch of the company once owned by Barry Diller, the one that promoted loans, mortgages, etc, etc. So you can imagine how difficult conditions have been in the past year or so for such a company.
As I closed off my trade on Google, I looked at charts and data and felt like there was still a lot of upside, so I wanted to get right back in. And what better way than to do it against a company that just increased 10% in its last day of trading, Tree.com. You can take a look at the announcement done by management that caused the big rise here. Basically, guidance for the company is higher than analysts had expected.
I don’t buy it, I still put a lot more faith in a company like Google in a tough environment like the one we currently are experiencing.
Take a look at graphs for both companies:
I just think that Tree will have a lot more trouble than anticipated. Just take a look at the traffic on LendingTree.com, probably their most known and valuable property…traffic is down over 20%.. not a big surprise.