Alliance Data Announces Credit Card Statistics

Piper Jaffray has published a research report on Alliance Data Systems Corporation

after the company reported December private label credit card statistics this morning. In the report, Piper Jaffray writes "Encouragingly, the portfolio's December delinquency rate and $ amount of delinquencies both moved lower for the third straight month. This trend boosts our confidence in a gradually improving '11 credit outlook for ADS after the 1Q11 when we expect seasonal factors (smaller portfolio after holiday spending) to keep the portfolio's charge-off rate elevated. We believe the returns on the portfolio are poised for further improvement as it benefits from lower credit losses and still low funding costs. ADS remains one of our top picks for '11 with the shares trading at 10.6x/9.4x our '11/'12 core EPS estimates, which imply 18%/13% growth." Piper Jaffray maintains its Overweight rating and $82 price target. Alliance Data Systems closed Friday at $72.16.