Alliance Data Systems (ADS) Cut to Strong Sell at ValuEngine

ValuEngine downgraded shares of Alliance Data Systems (NYSE:ADS) from a sell rating to a strong sell rating in a research report report published on Thursday.

Other research analysts have also issued reports about the company. Zacks Investment Research raised Alliance Data Systems from a hold rating to a buy rating and set a $261.00 target price on the stock in a report on Wednesday, July 25th. Stephens reaffirmed a buy rating and issued a $288.00 price objective on shares of Alliance Data Systems in a report on Friday, July 20th. Bank of America started coverage on Alliance Data Systems in a report on Monday, September 17th. They issued a buy rating and a $290.00 price objective on the stock. Jefferies Financial Group reaffirmed a buy rating and issued a $280.00 price objective on shares of Alliance Data Systems in a report on Tuesday, August 7th. Finally, Deutsche Bank set a $253.00 price objective on Alliance Data Systems and gave the company a buy rating in a report on Thursday, September 20th. Two research analysts have rated the stock with a sell rating, seven have given a hold rating and thirteen have assigned a buy rating to the company’s stock. Alliance Data Systems presently has a consensus rating of Buy and an average price target of $262.74.

ADS stock opened at $204.84 on Thursday. The company has a current ratio of 1.10, a quick ratio of 2.12 and a debt-to-equity ratio of 2.53. The company has a market cap of $11.25 billion, a P/E ratio of 9.75, a price-to-earnings-growth ratio of 0.78 and a beta of 1.71. Alliance Data Systems has a 1-year low of $192.02 and a 1-year high of $278.33.

Alliance Data Systems (NYSE:ADS) last posted its earnings results on Thursday, October 18th. The business services provider reported $6.26 earnings per share for the quarter, topping analysts’ consensus estimates of $6.19 by $0.07. The business had revenue of $2.02 billion for the quarter, compared to analyst estimates of $2.03 billion. Alliance Data Systems had a return on equity of 56.33% and a net margin of 12.11%. The firm’s revenue was up 5.4% compared to the same quarter last year. During the same period in the previous year, the firm earned $5.35 EPS. Equities analysts forecast that Alliance Data Systems will post 21.53 EPS for the current year.

The business also recently announced a quarterly dividend, which will be paid on Wednesday, December 19th. Stockholders of record on Wednesday, November 14th will be given a dividend of $0.57 per share. The ex-dividend date of this dividend is Tuesday, November 13th. This represents a $2.28 dividend on an annualized basis and a dividend yield of 1.11%. Alliance Data Systems’s payout ratio is 12.47%.

Alliance Data Systems announced that its board has authorized a share repurchase plan on Monday, July 30th that authorizes the company to buyback $500.00 million in shares. This buyback authorization authorizes the business services provider to repurchase up to 4% of its stock through open market purchases. Stock buyback plans are often an indication that the company’s board believes its stock is undervalued.

In related news, EVP Bryan A. Pearson sold 3,424 shares of the company’s stock in a transaction on Tuesday, August 14th. The stock was sold at an average price of $231.67, for a total transaction of $793,238.08. The sale was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this link. Corporate insiders own 2.60% of the company’s stock.

Several hedge funds have recently made changes to their positions in ADS. LPL Financial LLC lifted its position in shares of Alliance Data Systems by 218.8% during the 1st quarter. LPL Financial LLC now owns 4,189 shares of the business services provider’s stock worth $892,000 after buying an additional 2,875 shares during the last quarter. Royal Bank of Canada lifted its position in shares of Alliance Data Systems by 13.1% during the 1st quarter. Royal Bank of Canada now owns 54,974 shares of the business services provider’s stock worth $11,701,000 after buying an additional 6,366 shares during the last quarter. Principal Financial Group Inc. lifted its position in shares of Alliance Data Systems by 2.4% during the 1st quarter. Principal Financial Group Inc. now owns 75,909 shares of the business services provider’s stock worth $16,158,000 after buying an additional 1,786 shares during the last quarter. Allianz Asset Management GmbH lifted its position in shares of Alliance Data Systems by 121.8% during the 1st quarter. Allianz Asset Management GmbH now owns 5,979 shares of the business services provider’s stock worth $1,273,000 after buying an additional 3,283 shares during the last quarter. Finally, Suntrust Banks Inc. lifted its position in shares of Alliance Data Systems by 678.7% during the 1st quarter. Suntrust Banks Inc. now owns 6,300 shares of the business services provider’s stock worth $1,340,000 after buying an additional 5,491 shares during the last quarter. Institutional investors and hedge funds own 93.75% of the company’s stock.

About Alliance Data Systems

Alliance Data Systems Corporation provides data-driven marketing and loyalty solutions worldwide. It operates through three segments: LoyaltyOne, Epsilon, and Card Services. 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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