Alliance Data Systems Corp

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ADS : NYSE : Services
$233.50 up 0.50 | 0.21%
Today's Range: 232.78 - 234.20
Avg. Daily Volume: 832,900
07/27/16 - 9:50 AM ET

Financial Analysis


Even though sales increased, the net income has decreased, representing a decrease to the bottom line.

During the same period, stockholders' equity ("net worth") has decreased by 11.71% from the same quarter last year.

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Income Statement Q2 FY16 Q2 FY15
Net Sales ($mil)1748.91500.62
EBITDA ($mil)0.0407.83
EBIT ($mil)0.0285.72
Net Income ($mil)73.1131.34


Balance Sheet Q2 FY16 Q2 FY15
Cash & Equiv. ($mil)0.01345.91
Total Assets ($mil)22771.219547.44
Total Debt ($mil)0.014651.39
Equity ($mil)1729.71959.15


Profitability Q2 FY16 Q2 FY15
Gross Profit Margin0.040.26
EBITDA Margin0.027.17
Operating Margin0.019.04
Sales Turnover0.30.3
Return on Assets2.132.53
Return on Equity28.1625.28
Debt Q2 FY16 Q2 FY15
Current Ratio0.02.2
Debt/Capital0.00.88
Interest Expense103.780.72
Interest Coverage0.03.54


Share Data Q2 FY16 Q2 FY15
Shares outstanding (mil)59.061.72
Div / share0.00.0
EPS1.242.11
Book value / share29.3231.74
Institutional Own % n/a n/a
Avg Daily Volume850504.01002963.0

Valuation


HOLD. ALLIANCE DATA SYSTEMS CORP's P/E ratio indicates a premium compared to an average of 27.40 for the IT Services industry and a premium compared to the S&P 500 average of 25.05. For additional comparison, its price-to-book ratio of 7.81 indicates a significant premium versus the S&P 500 average of 2.81 and a discount versus the industry average of 8.25. The price-to-sales ratio is similar to the S&P 500 average, but it is significantly below the industry average, indicating a discount.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
ADS 28.53 Peers 27.40   ADS 7.32 Peers 20.12

Average. An average P/E ratio can signify an industry neutral price for a stock and an average growth expectation.

ADS is trading at a valuation on par with its peers.

 

Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

ADS is trading at a significant discount to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
ADS 12.09 Peers 21.67   ADS 0.32 Peers 2.70

Discount. A lower price-to-projected earnings ratio than its peers can signify a less expensive stock or lower future growth expectations.

ADS is trading at a significant discount to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

ADS trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
ADS 7.81 Peers 8.25   ADS -0.13 Peers 23.94

Average. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

ADS is trading at a valuation on par with its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, ADS is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
ADS 2.00 Peers 5.30   ADS 14.49 Peers 22.71

Discount. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

ADS is trading at a significant discount to its industry on this measurement.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

ADS significantly trails its peers on the basis of sales growth

 

 

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