Retail Services manages nearly 90 branded credit card and marketing programs for many of today’s leading retail brands.
Epsilon is a full-service marketing firm providing a range of solutions, including consumer database marketing, direct mail, email, and consulting.
LoyaltyOne designs, delivers, and manages a suite of loyalty marketing services, most notably the AIR MILES Reward Program.
Since coming public in 2001 every year has shown improved sales and earnings including the economically savaged 2008 and 2009 periods. Here are ADS’s per share numbers (from continuing operations) as reported by Value Line:
|Year||Sales||C/F||EPS||Avg. P/E||52-Week Range|
|2001||10.29||1.08||0.03||NMF||11.00 – 19.50|
|2002||11.30||1.36||0.45||44.7x||13.70 – 26.20|
|2003||12.86||1.84||1.03||23.2x||14.60 – 30.90|
|2004||15.27||2.68||1.54||24.3x||26.60 – 48.50|
|2005||19.31||3.41||2.06||19.1x||31.90 – 47.30|
|2006||25.09||4.79||3.14||16.8x||34.90 – 66.10|
|2007||29.09||5.97||3.75||19.3x||56.80 – 80.80|
|2008||28.03||6.39||4.40||12.4x||34.80 – 75.00|
|2009||37.90||8.40||5.21||9.3x||22.80 – 69.10|
As the revenues, cash flow and earnings have grown the P/E has compressed to the lowest ever post-IPO of this good performing company. Zacks sees 2010 – 2011 EPS of $5.36 and $6.27 while Value Line is looking for $5.90 and $6.50 respectively.
Value Line notes that ADS has outperformed 95% of their 1700 stock universe for “stock price growth persistence” and is in the 85Th percentile for “earnings predictability”. Reuters has an ‘outperform’ rating on ADS and has estimates even higher than Value Line at $5.98 and $6.85 for 2010 – 2011.
Using the lowest, Zacks’ estimates, ADS now trades at< 10.5x this year’s and