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Alliance Data (ADS) Beats on Q1 Earnings, Revenues Rise Y/Y

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Have you been eager to see how Alliance Data Systems Corporation performed in the first quarter in comparison with the market expectations? Let’s quickly scan through the key facts from this OH-based property and casualty insurer’s earnings release this morning

An Earnings Beat

Alliance Data reported adjusted earnings per share of $4.44 per share, beating the Zacks Consensus Estimate of $4.27. Earnings improved 13% year over year on lower tax and share count.

Alliance Data Systems Corporation Price and EPS Surprise

Revenues Improve

Alliance Data generated total revenues of $1.88 billion, increased 0.3% year over year. Pro forma revenue, which adjusts for the change to net revenue presentation for AIR MILES effective Jan 1, 2018, improved 4% year over year to $1.96 billion.

How Was the Estimate Revision Trend?

You should note that the Zacks Consensus Estimate for Alliance Data dropped 6.6%  prior to the earnings release. Nonetheless, Alliance Data has a solid earnings surprise history. The company surpassed the Zacks Consensus Estimate in the last four quarters with an average beat of 9.69%.

Key Stats to Note

•  Adjusted EBITDA (net of funding costs) decreased 0.7% year over year to $437 million.
•  AIR MILES’ reward miles issued decreased 1% while AIR MILES’ reward miles redeemed decreased 4%.
•  For 2018, the company continues to expect core EPS between Core EPS of $22.50 to $23.00, up 16% to 19% over 2017. Revenue of $8.35 billion reflects 8% increase over 2017.

What Zacks Rank Says    

The company carries Zacks Rank #4 (Sell). However, since the latest earnings performance is yet to be reflected in the estimate revisions, the rank is subject to change. Now it all depends on what sense the just-released report makes to the analysts.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Check back later for our full write up on this ADS earnings report later!

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