We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Can Alliance Data (ADS) Deliver a Surprise in Q2 Earnings?
Read MoreHide Full Article
Alliance Data Systems Corporation is scheduled to report second-quarter results before the opening bell on Jul 21. Last quarter, this company delivered a 4.61% positive earnings surprise. Let’s see how things are shaping up for this announcement.
Factors Influencing this Past Quarter
We expect Alliance Data’s second-quarter results to benefit from strategic acquisitions, that of Conversant in particular. The Card Services business is likely to see another solid quarter driven by compelling product offerings that in turn should boost the top line.
BrandLoyalty is also expected to deliver decent results. Management expects revenues at BrandLoyalty to improve 50% fueled by the continued ramping up of its business profile.
Share repurchases in the quarter should aid the bottom line. However, adverse foreign expense might weigh on it.
The company expects 8% growth in both revenues to $1.62 billion and core earnings per share (EPS) to $3.58. Adjusted EBITDA should is also likely to improve in high single digits.
Moreover, management estimates gross yield compression at card services to mellow down driven by changes in programs.
However, the company expects AIR MILES issuance growth to be down 2% owing to lower promotional activity.
With respect to the surprise trend, Alliance Data surpassed expectations in each of the last four quarters, with an average beat of 2.19%.
The company’s share price has been fluctuating over the last few days. We wait to see how the stock reacts to the quarter’s results.
Our proven model does not conclusively show that Alliance Data will beat the Zacks Consensus Estimate in the second quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy) or at least 2 (Buy) or 3 (Hold) for this to happen. But this is not the case here as elaborated below.
Zacks ESP: Earnings ESP is 0.00% for Alliance Data as the Most Accurate estimate and the Zacks Consensus Estimate stand at $3.32 each.
Zacks Rank: Alliance Date has a Zacks Rank #3, which increases the predictive power of ESP. However, a 0.00% Earnings ESP makes surprise prediction difficult.
We note that Sell-rated stocks (Zacks Rank #4 or 5) should never be considered going into an earnings announcement.
Stocks to Consider
Here are some companies you may want to consider as these have the right combination of elements to post an earnings beat this quarter:
Global Payments Inc. (GPN - Free Report) has an Earnings ESP of +1.47% and a Zacks Rank #3. The company is scheduled to release second-quarter earnings results on Jul 28.
Aflac, Inc. (AFL - Free Report) has an Earnings ESP of +1.19% and a Zacks Rank #3. The company is expected to report second-quarter earnings results on Jul 28.
American Express Company (AXP - Free Report) has an Earnings ESP of +1.04% and a Zacks Rank #3. The company is scheduled to release second-quarter earnings results on Jul 20.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Can Alliance Data (ADS) Deliver a Surprise in Q2 Earnings?
Alliance Data Systems Corporation is scheduled to report second-quarter results before the opening bell on Jul 21. Last quarter, this company delivered a 4.61% positive earnings surprise. Let’s see how things are shaping up for this announcement.
Factors Influencing this Past Quarter
We expect Alliance Data’s second-quarter results to benefit from strategic acquisitions, that of Conversant in particular. The Card Services business is likely to see another solid quarter driven by compelling product offerings that in turn should boost the top line.
BrandLoyalty is also expected to deliver decent results. Management expects revenues at BrandLoyalty to improve 50% fueled by the continued ramping up of its business profile.
Share repurchases in the quarter should aid the bottom line. However, adverse foreign expense might weigh on it.
The company expects 8% growth in both revenues to $1.62 billion and core earnings per share (EPS) to $3.58. Adjusted EBITDA should is also likely to improve in high single digits.
Moreover, management estimates gross yield compression at card services to mellow down driven by changes in programs.
However, the company expects AIR MILES issuance growth to be down 2% owing to lower promotional activity.
With respect to the surprise trend, Alliance Data surpassed expectations in each of the last four quarters, with an average beat of 2.19%.
The company’s share price has been fluctuating over the last few days. We wait to see how the stock reacts to the quarter’s results.
ALLIANCE DATA Price and EPS Surprise
ALLIANCE DATA Price and EPS Surprise | ALLIANCE DATA Quote
Earnings Whispers
Our proven model does not conclusively show that Alliance Data will beat the Zacks Consensus Estimate in the second quarter. That is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy) or at least 2 (Buy) or 3 (Hold) for this to happen. But this is not the case here as elaborated below.
Zacks ESP: Earnings ESP is 0.00% for Alliance Data as the Most Accurate estimate and the Zacks Consensus Estimate stand at $3.32 each.
Zacks Rank: Alliance Date has a Zacks Rank #3, which increases the predictive power of ESP. However, a 0.00% Earnings ESP makes surprise prediction difficult.
We note that Sell-rated stocks (Zacks Rank #4 or 5) should never be considered going into an earnings announcement.
Stocks to Consider
Here are some companies you may want to consider as these have the right combination of elements to post an earnings beat this quarter:
Global Payments Inc. (GPN - Free Report) has an Earnings ESP of +1.47% and a Zacks Rank #3. The company is scheduled to release second-quarter earnings results on Jul 28.
Aflac, Inc. (AFL - Free Report) has an Earnings ESP of +1.19% and a Zacks Rank #3. The company is expected to report second-quarter earnings results on Jul 28.
American Express Company (AXP - Free Report) has an Earnings ESP of +1.04% and a Zacks Rank #3. The company is scheduled to release second-quarter earnings results on Jul 20.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>