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

Have you been eager to see how Alliance Data Systems Corporation (NYSE:ADS) 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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