Oppenheimer Weighs in on Alliance Data Systems Co.’s FY2018 Earnings (ADS)

Alliance Data Systems Co. (NYSE:ADS) – Investment analysts at Oppenheimer issued their FY2018 earnings estimates for shares of Alliance Data Systems in a research report issued on Friday, October 5th. Oppenheimer analyst D. Gabriele anticipates that the business services provider will post earnings of $21.52 per share for the year. Oppenheimer has a “Hold” rating on the stock. Oppenheimer also issued estimates for Alliance Data Systems’ Q4 2018 earnings at $6.78 EPS and FY2019 earnings at $23.86 EPS.

Alliance Data Systems (NYSE:ADS) last announced its quarterly earnings results on Thursday, July 19th. The business services provider reported $5.01 earnings per share (EPS) for the quarter, beating the consensus estimate of $4.64 by $0.37. Alliance Data Systems had a net margin of 11.35% and a return on equity of 59.18%. The firm had revenue of $1.97 billion during the quarter, compared to the consensus estimate of $1.93 billion. During the same period last year, the firm posted $3.84 EPS. The firm’s quarterly revenue was up 8.1% on a year-over-year basis.

Several other equities analysts also recently issued reports on ADS. Robert W. Baird raised shares of Alliance Data Systems from a “neutral” rating to an “outperform” rating and set a $242.00 price target for the company in a report on Monday, June 18th. ValuEngine raised shares of Alliance Data Systems from a “strong sell” rating to a “sell” rating in a report on Thursday, July 12th. Wolfe Research initiated coverage on shares of Alliance Data Systems in a report on Tuesday, July 17th. They set an “outperform” rating for the company. JPMorgan Chase & Co. reissued a “hold” rating on shares of Alliance Data Systems in a report on Wednesday, July 18th. Finally, Stephens reaffirmed a “buy” rating and issued a $288.00 target price on shares of Alliance Data Systems in a research note on Friday, July 20th. Two research analysts have rated the stock with a sell rating, seven have issued a hold rating and twelve have given a buy rating to the company. Alliance Data Systems presently has an average rating of “Hold” and a consensus target price of $262.06.

Shares of ADS stock opened at $229.42 on Monday. Alliance Data Systems has a 12-month low of $192.02 and a 12-month high of $278.33. The stock has a market cap of $12.98 billion, a P/E ratio of 12.55, a PEG ratio of 0.89 and a beta of 1.76. The company has a quick ratio of 2.12, a current ratio of 2.14 and a debt-to-equity ratio of 7.25.

The business also recently announced a quarterly dividend, which was paid on Wednesday, September 19th. Shareholders of record on Tuesday, August 14th were paid a $0.57 dividend. This represents a $2.28 dividend on an annualized basis and a dividend yield of 0.99%. The ex-dividend date was Monday, August 13th. Alliance Data Systems’s dividend payout ratio is presently 12.47%.

Alliance Data Systems announced that its board has authorized a share buyback program on Monday, July 30th that allows the company to buyback $500.00 million in shares. This buyback authorization allows the business services provider to purchase up to 4% of its shares through open market purchases. Shares buyback programs are usually an indication that the company’s board of directors believes its stock is undervalued.

In related news, CFO Charles L. Horn sold 16,035 shares of the business’s stock in a transaction that occurred on Tuesday, July 24th. The shares were sold at an average price of $232.58, for a total transaction of $3,729,420.30. Following the completion of the sale, the chief financial officer now directly owns 28,688 shares of the company’s stock, valued at $6,672,255.04. The transaction was disclosed in a legal filing with the SEC, which is available at this link. Also, EVP Bryan A. Pearson sold 3,424 shares of the business’s stock in a transaction that occurred on Tuesday, August 14th. The stock was sold at an average price of $231.67, for a total transaction of $793,238.08. The disclosure for this sale can be found here. Insiders own 2.60% of the company’s stock.

Institutional investors and hedge funds have recently bought and sold shares of the stock. Pittenger & Anderson Inc. bought a new stake in shares of Alliance Data Systems during the second quarter worth approximately $117,000. Piedmont Investment Advisors LLC bought a new stake in shares of Alliance Data Systems during the second quarter worth approximately $127,000. Ledyard National Bank bought a new stake in shares of Alliance Data Systems during the second quarter worth approximately $187,000. First Interstate Bank raised its stake in shares of Alliance Data Systems by 45.2% during the second quarter. First Interstate Bank now owns 864 shares of the business services provider’s stock worth $201,000 after buying an additional 269 shares during the last quarter. Finally, grace capital bought a new stake in shares of Alliance Data Systems during the second quarter worth approximately $210,000. 93.38% of the stock is owned by institutional investors and hedge funds.

Alliance Data Systems Company Profile

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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