Earnings to Watch – Alliance Data Systems Corporation (NYSE:ADS)

Alliance Data Systems Corporation (NYSE:ADS) has market worth of 11.96B along 55.99M outstanding shares. The stock moved 0.96% to $213.61 in recent session. The recent traded volume was 901416 shares. The stock had closed at $211.58 on the previous day. The stock has recorded a weekly performance of 3.76% and monthly performance is -7.07%. Shares have moved -17.29% over the last quarter and changed -6.63% over the recent six months. The shares registered yearly performance at -10.25% and YTD move seen at -15.73%.

Alliance Data Systems Corporation (NYSE:ADS), a leading global provider of data-driven marketing and loyalty solutions, today announced results for the quarter ended March 31, 2018.

Ed Heffernan, president and chief executive officer of Alliance Data, commented, “The first quarter’s biggest accomplishment was the completion of the process to insource the collection of charged-off accounts. This effort has taken several quarters to complete and required us to absorb lower recovery rates during that period. Nonetheless, this investment was necessary to fully realize the value of this cash flow stream. This significant headwind to earnings and growth rate should become a tailwind as the year progresses.”

Heffernan continued, “This quarter’s pro forma revenue growth of 4 percent and core EPS growth of 13 percent should reflect our softest quarter of the year. Specifically, higher reserve levels required to cover the transitory impacts of the internal recovery investment was an approximate $0.60 hit to core EPS for the first quarter. Moving forward, recovery rates should move in our favor.”


Revenue was $1.88 billion for the first quarter of 2018, flat with the prior year. Pro forma revenue − which adjusts for the change to net revenue presentation for AIR MILES® effective January 1, 2018 − increased 4 percent. EPS increased 14 percent to $2.95 and core EPS increased 13 percent to $4.44 for the first quarter of 2018, both benefitting from lower tax rates and share count. Adjusted EBITDA, net was $437 million for the first quarter of 2018, flat with the prior year.

Reiterating 2018 Guidance

Revenue of $8.35 billion, representing an 8 percent increase, 12 percent on a pro forma basis.

Core EPS of $22.50 to $23.00, representing a 16 to 19 percent increase over 2017.

In terms of profitability, Alliance Data Systems Corporation has a gross margin of 44.70%, an operating margin of 21.30% and a net profit margin of 10.20%. Return on assets come to 2.90% and return on investment coming to 4.70% while Return on equity come to 50.60%.

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