Head to Head Analysis: Alliance Data Systems Corporation (ADS) versus The Competition
Alliance Data Systems Corporation (NYSE: ADS) is one of 98 public companies in the “Business Support Services” industry, but how does it contrast to its peers? We will compare Alliance Data Systems Corporation to similar businesses based on the strength of its earnings, dividends, profitability, risk, analyst recommendations, valuation and institutional ownership.
This is a summary of recent ratings and price targets for Alliance Data Systems Corporation and its peers, as provided by MarketBeat.
|Sell Ratings||Hold Ratings||Buy Ratings||Strong Buy Ratings||Rating Score|
|Alliance Data Systems Corporation||3||7||10||0||2.35|
|Alliance Data Systems Corporation Competitors||747||2117||2699||84||2.38|
Alliance Data Systems Corporation currently has a consensus target price of $253.44, indicating a potential upside of 12.26%. As a group, “Business Support Services” companies have a potential downside of 4.90%. Given Alliance Data Systems Corporation’s higher possible upside, research analysts plainly believe Alliance Data Systems Corporation is more favorable than its peers.
Volatility & Risk
Alliance Data Systems Corporation has a beta of 1.76, meaning that its stock price is 76% more volatile than the S&P 500. Comparatively, Alliance Data Systems Corporation’s peers have a beta of 1.12, meaning that their average stock price is 12% more volatile than the S&P 500.
Alliance Data Systems Corporation pays an annual dividend of $2.08 per share and has a dividend yield of 0.9%. Alliance Data Systems Corporation pays out 23.7% of its earnings in the form of a dividend. As a group, “Business Support Services” companies pay a dividend yield of 1.1% and pay out 26.9% of their earnings in the form of a dividend.
Institutional & Insider Ownership
96.0% of Alliance Data Systems Corporation shares are held by institutional investors. Comparatively, 62.9% of shares of all “Business Support Services” companies are held by institutional investors. 2.6% of Alliance Data Systems Corporation shares are held by company insiders. Comparatively, 12.1% of shares of all “Business Support Services” companies are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a company is poised for long-term growth.
This table compares Alliance Data Systems Corporation and its peers’ net margins, return on equity and return on assets.
|Net Margins||Return on Equity||Return on Assets|
|Alliance Data Systems Corporation||6.77%||59.67%||3.74%|
|Alliance Data Systems Corporation Competitors||-128.28%||-184.52%||-5.72%|
Earnings & Valuation
This table compares Alliance Data Systems Corporation and its peers top-line revenue, earnings per share and valuation.
|Gross Revenue||EBITDA||Price/Earnings Ratio|
|Alliance Data Systems Corporation||$7.41 billion||$1.47 billion||25.71|
|Alliance Data Systems Corporation Competitors||$1.12 billion||$179.80 million||21.77|
Alliance Data Systems Corporation has higher revenue and earnings than its peers. Alliance Data Systems Corporation is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.
Alliance Data Systems Corporation beats its peers on 11 of the 15 factors compared.
About Alliance Data Systems Corporation
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. The Company operates through three segments: LoyaltyOne, which provides coalition and short-term loyalty programs through the Company’s Canadian AIR MILES Reward Program and BrandLoyalty Group B.V. (BrandLoyalty); Epsilon, which provides end-to-end, integrated direct marketing solutions, and Card Services, which provides risk management solutions, account origination, funding, transaction processing, customer care, collections and marketing services for the Company’s private label and co-brand retail credit card programs.
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