Alliance Data Systems (ADS) Rating Increased to Buy at Zacks Investment Research

Zacks Investment Research upgraded shares of Alliance Data Systems (NYSE:ADS) from a hold rating to a buy rating in a research note published on Tuesday morning. The firm currently has $310.00 target price on the business services provider’s stock.

According to Zacks, “Alliance Data remains well-positioned for growth from significant opportunities owing to the current trend in consumer-based businesses, shifting their marketing spends to data-driven marketing strategies. 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. For 2017, core EPS is expected at $18.10 on $7.8 billion revenues and for 2018, core EPS is projected at $21.50 on revenues of $8.7 billion. However, increasing expenses and dependence on limited clients for revenues, raise concerns. Shares of Alliance Data have underperformed the industry in a year. It is set to release fourth quarter results on Jan 25. A Zacks Rank #2 increases the predictive power of a beat, but combined with the Earnings ESP of -1.27%, makes prediction difficult.”

A number of other equities analysts have also weighed in on the company. Keefe, Bruyette & Woods reiterated a buy rating and set a $300.00 target price on shares of Alliance Data Systems in a research note on Friday, October 6th. Royal Bank of Canada reiterated a buy rating and set a $293.00 target price on shares of Alliance Data Systems in a research note on Thursday, January 4th. Oppenheimer set a $208.00 target price on Alliance Data Systems and gave the stock a sell rating in a research note on Thursday, October 26th. Barclays reiterated an equal weight rating and set a $298.00 target price (up previously from $278.00) on shares of Alliance Data Systems in a research note on Monday, January 8th. Finally, BMO Capital Markets reiterated a hold rating and set a $235.00 target price on shares of Alliance Data Systems in a research note on Wednesday, November 22nd. Four analysts have rated the stock with a sell rating, nine have assigned a hold rating and ten have assigned a buy rating to the company. The stock currently has an average rating of Hold and a consensus target price of $274.06.

Alliance Data Systems (NYSE:ADS) traded up $5.88 during trading hours on Tuesday, reaching $261.82. The company’s stock had a trading volume of 692,298 shares, compared to its average volume of 459,640. The company has a quick ratio of 2.09, a current ratio of 2.11 and a debt-to-equity ratio of 9.53. The company has a market capitalization of $14,140.35, a price-to-earnings ratio of 27.76, a price-to-earnings-growth ratio of 0.92 and a beta of 1.79. Alliance Data Systems has a 12-month low of $209.00 and a 12-month high of $278.33.

Alliance Data Systems (NYSE:ADS) last released its quarterly earnings data on Thursday, October 19th. The business services provider reported $5.35 earnings per share (EPS) for the quarter, beating the consensus estimate of $4.80 by $0.55. The firm had revenue of $1.91 billion for the quarter, compared to analyst estimates of $1.97 billion. Alliance Data Systems had a return on equity of 62.95% and a net margin of 7.09%. The business’s revenue for the quarter was up 1.4% compared to the same quarter last year. During the same quarter in the prior year, the company earned $4.74 earnings per share. equities research analysts forecast that Alliance Data Systems will post 17.06 earnings per share for the current fiscal year.

In other Alliance Data Systems 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 sale was disclosed in a filing with the SEC, which is available at this link. Company insiders own 2.60% of the company’s stock.

Hedge funds have recently modified their holdings of the business. ETF Managers Group LLC acquired a new stake in shares of Alliance Data Systems in the 2nd quarter valued at $128,000. WFG Advisors LP boosted its holdings in shares of Alliance Data Systems by 135.9% in the 2nd 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. Commonwealth Bank of Australia boosted its holdings in shares of Alliance Data Systems by 66.6% in the 2nd quarter. Commonwealth Bank of Australia now owns 728 shares of the business services provider’s stock valued at $185,000 after purchasing an additional 291 shares in the last quarter. Simonbaker & Partners LLC acquired a new stake in shares of Alliance Data Systems in the 2nd quarter valued at $202,000. Finally, CAPROCK Group Inc. acquired a new stake in shares of Alliance Data Systems in the 4th quarter valued at $268,000. 94.59% of the stock is currently owned by hedge funds and other 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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