Zacks Investment Research Upgrades Alliance Data Systems (ADS) to Buy

Alliance Data Systems (NYSE:ADS) was upgraded by Zacks Investment Research from a “hold” rating to a “buy” rating in a research report issued to clients and investors on Friday, January 26th. The firm presently has a $283.00 price target on the business services provider’s stock. Zacks Investment Research‘s price target points to a potential upside of 13.98% from the stock’s previous close.

According to Zacks, “Alliance Data’s fourth-quarter bottom line beat expectation on strong segmental performance. Organic growth remained a key strength at Alliance Data, indicated by its continued revenue growth. It has made several strategic acquisitions to grow inorganically. Solid receivables growth in Card Services along with strength in LoyaltyOne and Epsilon segments should continue to drive top-line growth. A strong balance sheet position enables the company deploy capital in growth initiatives as well as shareholder-friendly moves. A lowered corporate tax rate, reducing net deferred tax liabilities and future cash tax will help generate additional $100 million in free cash flow. For 2018, core EPS is expected between $22.50 and $23.00 on $8.35 billion revenues. However, increasing expenses and dependence on limited clients for revenues raise concerns. Shares of Alliance Data have underperformed the industry in a year.”

A number of other equities analysts have also recently issued reports on the company. BMO Capital Markets lowered their target price on Alliance Data Systems to $250.00 and set a “market perform” rating for the company in a report on Friday, January 26th. Edward Jones upgraded Alliance Data Systems from a “hold” rating to a “buy” rating in a research report on Friday, January 26th. Piper Jaffray Companies reiterated a “buy” rating and issued a $368.00 price target on shares of Alliance Data Systems in a research report on Thursday, January 18th. Credit Suisse Group reiterated an “underperform” rating and issued a $218.00 price target (up previously from $193.00) on shares of Alliance Data Systems in a research report on Wednesday, January 17th. Finally, Robert W. Baird restated a “hold” rating and set a $270.00 target price on shares of Alliance Data Systems in a research report on Tuesday, January 9th. Four investment analysts have rated the stock with a sell rating, six have issued a hold rating and thirteen have given a buy rating to the company. Alliance Data Systems has a consensus rating of “Hold” and a consensus price target of $276.44.

Alliance Data Systems (NYSE ADS) opened at $248.29 on Friday. The company has a market capitalization of $13,720.00, a P/E ratio of 17.57, a PEG ratio of 0.86 and a beta of 1.71. Alliance Data Systems has a one year low of $209.00 and a one year high of $278.33. The company has a debt-to-equity ratio of 8.02, a quick ratio of 2.09 and a current ratio of 1.91.

Alliance Data Systems (NYSE:ADS) last released its quarterly earnings results on Thursday, January 25th. The business services provider reported $6.10 earnings per share (EPS) for the quarter, beating the Thomson Reuters’ consensus estimate of $4.72 by $1.38. Alliance Data Systems had a return on equity of 66.17% and a net margin of 10.22%. The business had revenue of $2.11 billion during the quarter, compared to the consensus estimate of $2.15 billion. During the same period in the previous year, the company posted $4.67 EPS. The firm’s quarterly revenue was up 15.2% on a year-over-year basis. research analysts anticipate that Alliance Data Systems will post 21.49 earnings per share for the current fiscal year.

In other news, CFO Charles L. Horn sold 2,128 shares of the firm’s stock in a transaction on Thursday, November 30th. The stock was sold at an average price of $235.00, for a total value of $500,080.00. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available through this hyperlink. 2.60% of the stock is owned by company insiders.

A number of large investors have recently bought and sold shares of ADS. Northwestern Mutual Wealth Management Co. boosted its stake in Alliance Data Systems by 516.3% during the fourth quarter. Northwestern Mutual Wealth Management Co. now owns 493 shares of the business services provider’s stock valued at $125,000 after buying an additional 413 shares during the period. ETF Managers Group LLC purchased a new stake in Alliance Data Systems during the second quarter valued at about $128,000. Tower Research Capital LLC TRC purchased a new stake in Alliance Data Systems during the fourth quarter valued at about $152,000. WFG Advisors LP raised its position in Alliance Data Systems by 135.9% during the second quarter. WFG Advisors LP now owns 677 shares of the business services provider’s stock valued at $174,000 after purchasing an additional 390 shares in the last quarter. Finally, FNY Managed Accounts LLC purchased a new stake in Alliance Data Systems during the fourth quarter valued at about $190,000. 93.68% of the stock is owned by institutional investors.

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Alliance Data Systems Company Profile

Alliance Data Systems Corporation is a provider of data-driven marketing and loyalty solutions serving consumer-based businesses in a range of industries. The Company offers a portfolio of integrated outsourced marketing solutions, including customer loyalty programs, database marketing services, end-to-end marketing services, analytics and creative services, direct marketing services, and private label and co-brand retail credit card programs.

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