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Is this Large Market Cap Stock target price reasonable for Alliance Data Systems Corporation (NYSE:ADS)?

The company in question is, Alliance Data Systems Corporation (NYSE:ADS) currently with a stock price of 213.08 (1.52% today). The market cap for Alliance Data Systems Corporation is 12488.62, and is in the sector Services, and Business Services industry. The target price for Alliance Data Systems Corporation is 256.55. Currently Alliance Data Systems Corporation is trading with a P/E of 26.6, and a forward P/E of 11.21. Average volume for Alliance Data Systems Corporation is 882.69 and so far today it is 847600.

Performance in the last year for Alliance Data Systems Corporation has been -14.94%. For EPS growth, Alliance Data Systems Corporation has seen a growth of 12.50%, and is looking to grow in the next year to 12.61%. More long term stats show that EPS growth has been 20.30% over the last five years and could be 14.28% for the next five years. Alliance Data Systems Corporation has seen sales growth quarter over quarter at 16.50%, with EPS growth quarter over quarter at -41.20%. The 20-day simple moving average is 1.14%, with the 200-day simple moving average coming to -4.55%.

Since the IPO date for Alliance Data Systems Corporation on the 6/15/2001, Alliance Data Systems Corporation has seen performance year to date to be -22.96%. With Alliance Data Systems Corporation trading at 213.08, the dividend yield is *TBA, and the EPS is 8.01.

So could Alliance Data Systems Corporation, be undervalued? Well as said before P/E is 26.6. The PEG is 1.86, P/S is 1.85 and the P/B is at 7.24. The P/cash is 9.49, with P/free cash flow at 7.51.

Alliance Data Systems Corporation ability to deal with debt shows that the current ratio is 2.2, and the quick ratio is 2.2. This is with long term debt/equity at 5.44, and total debt/equity at 6.77.

In terms of margins, Alliance Data Systems Corporation has a gross margin of 41.40%, an operating margin of 19.50% and a profit margin of 7.20%.Payout ratio for Alliance Data Systems Corporation is 0.00%. Return on assets come to 2.20% with return on investment coming to 6.30%.

Insider ownership for Alliance Data Systems Corporation, is at 1.90% and institutional ownership comes to 96.00%. Outstanding shares are at 58.61. While shares float is 57.06. The float short is currently 5.94%, and short ratio is 3.84.

Disclaimer: Remember there is a risk to your investment, this is not a recommendation, nor personal advice, never invest more than you are able too loose.

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Mark Hines

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