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Alliance Data Rewards Shareholders with $500M Buyback
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Alliance Data Systems Corporation announced a new share repurchase program to acquire up to $500 million of its common stock during 2017. This program replaces the company’s existing program, which expired in 2016.
The company intends to finance the repurchases through free cash flow. Further, Alliance Data expects “to maintain moderate levels of debt over the course of the repurchase program, providing flexibility to pursue tuck-in acquisitions, portfolio purchases and/or international loyalty coalition program expansions.”
The latest move certainly reaffirms the Plano, TX-based company’s commitment to enhance shareholders’ value. In fact, during fourth-quarter 2016, Alliance Data initiated a quarterly dividend, incorporating a major change in its shareholders return policy.
The company continues to depict strength in its fundamentals, with solid receivables growth in its Card Services segment. Alliance Data recorded average receivables of $15.21 billion for Nov 2016, up 22% year over year and in line with the growth rate witnessed in Oct 2016. However, net charge-offs for the month was 5.7%, compared to 5% in the prior-year period. Nevertheless, the company maintained its 2016 guidance of a 5.0% principal loss rate.
Alliance Data also guided a $7.2 billion in total revenue and core EPS of $16.90 for 2016. This reflects year-over-year increases of 11% and 12%, respectively.
Over the past six months, shares of Alliance Data increased 18%, outpacing the 6.7% gain recorded for the Zacks categorized Financial Transaction Services industry.
Currently, Alliance Data carries a Zacks Rank #3 (Hold).
Stocks to Consider
E*TRADE Financial Corporation : Over the last 60 days, the Zacks Consensus Estimate for 2016 moved up 2.2% to $1.83 and advanced 6.9% to $1.87 for 2017. The company boasts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Meta Financial Group, Inc. (CASH - Free Report) : Over the last 60 days, the Zacks Consensus Estimate jumped 11.8% for 2016 to $6.62 and 14.7% to $7.80 for 2017. The company sports a Zacks Rank #1.
Ameriprise Financial, Inc. (AMP - Free Report) : The Zacks Consensus Estimate for 2016 increased slightly to $9.16 for 2016 and to $10.37 for 2017, over the past 60 days. The company carries a Zacks Rank #2 (Buy).
Zacks' Top 10 Stocks for 2017
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2017?
Who wouldn't? As of early December, the 2016 Top 10 produced 5 double-digit winners including oil and natural gas giant Pioneer Natural Resources which racked up a stellar +50% gain. The new list is painstakingly hand-picked from 4,400 companies covered by the Zacks Rank. Be among the very first to see it>>
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Alliance Data Rewards Shareholders with $500M Buyback
Alliance Data Systems Corporation announced a new share repurchase program to acquire up to $500 million of its common stock during 2017. This program replaces the company’s existing program, which expired in 2016.
The company intends to finance the repurchases through free cash flow. Further, Alliance Data expects “to maintain moderate levels of debt over the course of the repurchase program, providing flexibility to pursue tuck-in acquisitions, portfolio purchases and/or international loyalty coalition program expansions.”
The latest move certainly reaffirms the Plano, TX-based company’s commitment to enhance shareholders’ value. In fact, during fourth-quarter 2016, Alliance Data initiated a quarterly dividend, incorporating a major change in its shareholders return policy.
The company continues to depict strength in its fundamentals, with solid receivables growth in its Card Services segment. Alliance Data recorded average receivables of $15.21 billion for Nov 2016, up 22% year over year and in line with the growth rate witnessed in Oct 2016. However, net charge-offs for the month was 5.7%, compared to 5% in the prior-year period. Nevertheless, the company maintained its 2016 guidance of a 5.0% principal loss rate.
Alliance Data also guided a $7.2 billion in total revenue and core EPS of $16.90 for 2016. This reflects year-over-year increases of 11% and 12%, respectively.
Over the past six months, shares of Alliance Data increased 18%, outpacing the 6.7% gain recorded for the Zacks categorized Financial Transaction Services industry.
Currently, Alliance Data carries a Zacks Rank #3 (Hold).
Stocks to Consider
E*TRADE Financial Corporation : Over the last 60 days, the Zacks Consensus Estimate for 2016 moved up 2.2% to $1.83 and advanced 6.9% to $1.87 for 2017. The company boasts a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Meta Financial Group, Inc. (CASH - Free Report) : Over the last 60 days, the Zacks Consensus Estimate jumped 11.8% for 2016 to $6.62 and 14.7% to $7.80 for 2017. The company sports a Zacks Rank #1.
Ameriprise Financial, Inc. (AMP - Free Report) : The Zacks Consensus Estimate for 2016 increased slightly to $9.16 for 2016 and to $10.37 for 2017, over the past 60 days. The company carries a Zacks Rank #2 (Buy).
Zacks' Top 10 Stocks for 2017
In addition to the stocks discussed above, would you like to know about our 10 finest buy-and-hold tickers for the entirety of 2017?
Who wouldn't? As of early December, the 2016 Top 10 produced 5 double-digit winners including oil and natural gas giant Pioneer Natural Resources which racked up a stellar +50% gain. The new list is painstakingly hand-picked from 4,400 companies covered by the Zacks Rank. Be among the very first to see it>>