Alliance Data Systems(BFH) ZACKS·2025-01-22 18:00Stock Performance and Trends - BFH is trading above its 50-day simple moving average (SMA), indicating a short-term bullish trend [1] - The share price was 66.71 [1] - Shares of BFH surged 107.3% in the past year, outperforming its industry (22.7%), the Finance sector (25%), and the S&P 500 (24.3%) [4][5] Valuation and Analyst Sentiment - BFH shares are trading at a forward P/E of 9.64X, lower than the industry average of 16.16X, with a Value Score of A [7] - Three out of seven analysts raised estimates for 2025, leading to a 0.7% increase in the Zacks Consensus Estimate over the past 30 days [8] Financial Metrics and Capital Efficiency - BFH's return on invested capital (ROIC) was 10% in the trailing 12 months, significantly higher than the industry average of 4.9% [9] - The company has been strengthening its balance sheet, lowering debt, and improving free cash flow conversion [13] Growth Drivers and Strategic Initiatives - Credit sales are expected to improve due to solid consumer spending, new partner additions, and holiday spending [10] - Credit metrics remain strong, with delinquency and net loss rates below historical averages [11] - BFH is investing in strategic growth areas, digital innovation, and technology enhancements, with partnerships including RBC, Fiserv, and Sezzle [12] Shareholder Value and Future Outlook - BFH focuses on returning value to shareholders through share repurchases and mergers and acquisitions [14] - The Zacks Consensus Estimate for 2025 revenues indicates a 3% year-over-year increase from 2024 [14] - The company has a solid track record of beating earnings estimates in two of the last four quarters, with an average beat of 70.23% [14]