In a report released yesterday, Dominick Gabriele from Oppenheimer maintained a Hold rating on Alliance Data Systems (ADS). The company’s shares closed yesterday at $162.19.
Gabriele observed:
“Reported 4Q18 “core” EPS of $7.06 vs. our/consensus’ $5.74/$6.95. We decided not to include the HFS reserve release. On 1/28/18 we released a note “Epsilon Value Deconstructed”. We tried to provide a template for investors to gauge the impact of Epsilon proceeds and value the remaining ADS entity post Epsilon sale. We have remained on the sidelines and still do, given the low visibility of the ongoing business and sale price of Epsilon. Management did their best to provide a reasonable amount of guidance but admitted the timing and assumptions around a sale make modeling ADS’ fundamental trajectory very difficult. Our scenario estimated a ~$157 valuation, thus we still see the stock as fairly valued even after the ~9.83% selloff.”
According to TipRanks.com, Gabriele is a 1-star analyst with an average return of -1.3% and a 47.8% success rate. Gabriele covers the Financial sector, focusing on stocks such as Discover Financial Services, Credit Acceptance Corp, and Santander Consumer USA.
Currently, the analyst consensus on Alliance Data Systems is a Moderate Buy with an average price target of $217.83.
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Based on Alliance Data Systems’ latest earnings release for the quarter ending September 30, the company reported a quarterly net profit of $297 million. In comparison, last year the company had a net profit of $271 million.
Based on the recent corporate insider activity of 38 insiders, corporate insider sentiment is negative on the stock.
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Alliance Data Systems Corp. engages in the provision of data-driven and transaction-based marketing and customer loyalty solutions. It operates through the following segments: LoyaltyOne, Epsilon, Card Services, and Corporate and Other. The LoyaltyOne segment provides coalition and short-term loyalty programs.
