Yahoo Finance Here's Why You Should Hold on to Bread Financial (BFH) Stock
Bread Financial Holdings, Inc.’s BFH solid consumer spending, solid credit sales performance, strategic investments and robust capital position make the stock worth retaining in one’s portfolio.
Growth Projections
The Zacks Consensus Estimate for BFH’s 2023 and 2024 earnings is pegged at $9.72 and $10.20, indicating a 117.4% and 4.9% increase from the year-ago reported figure, driven by 6.3% and 7.8% higher revenues of $4.07 billion and $4.39 billion, respectively.
Zacks Rank
Bread Financial currently has a Zacks Rank #3 (Hold).
Business Tailwinds
The credit sales performance is expected to improve on the back of solid consumer spending. With the continued growth of credit sales, average loans are likely to increase. With new partner additions and holiday spending, BFH continues to expect strong credit sales.
Credit metrics should continue to remain strong with delinquency and net loss rates remaining below the historical averages. Given disciplined, proactive risk management and strong consumer payment behavior, net loss rates are expected to remain low.
BFH should continue to invest in its digital platform, product innovation, marketing efforts and technology modernization. BFH intends to make incremental strategic investments of more than $125 million in technology modernization, digital advancement, marketing and product innovation to fuel growth opportunities and future operating efficiencies.
Capital ratios are likely to improve on the back of a rise in retained earnings, thus providing flexibility to continue to support profitable growth.
Bread Financial boasts a strong balance sheet by virtue of its solid cash position and has sufficient cash reserves to meet debt obligations.
Bread Financial remains focused on returning value to its shareholders. It uses share repurchases as a tool to mitigate the adverse impact of foreign exchange and intends to focus more on share buybacks and mergers and acquisitions.
The Zacks Consensus Estimate for Bread Financial’s 2023 earnings has moved up 2.6% in the past 30 days, reflecting analysts’ optimism.
Price Performance
In the past year, the stock has decreased 47.7% compared with the industry’s decline of 7.2%. Strong fundamentals of Bread Financial are likely to help the stock bounce back.
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Stocks to Consider
Some better-ranked financial transaction service providers are Paysafe Limited PSFE, Fiserv Inc. FISV and Visa Inc. V.
Paysafe’s earnings surpassed estimates in three of the last four quarters and missed in one, the average being 84.29%. In the past year, PSFE has lost 58.5%.
The Zacks Consensus Estimate for PSFE’s 2024 earnings indicates a year-over-year increase of 107.8%. PSFE sports a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Fiserv’s earnings surpassed estimates in three of the last four reported quarters while missing in one. In the past year, FISV has gained 10.3%.
The Zacks Consensus Estimate for FISV’s 2023 and 2024 earnings indicates a respective year-over-year increase of 12.7% and 14.3%. Currently, Fiserv carries a Zacks Rank #2 (Buy).
Visa has a decent track record of beating earnings estimates in each of the last four reported quarters, the average beat being 8.62%. In the past year, V has gained 0.7%.
The Zacks Consensus Estimate for V’s 2023 and 2024 earnings indicates a respective year-over-year increase of 12.4% and 13.5%. Visa carries a Zacks Rank #2 at present.
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Visa Inc. (V) : Free Stock Analysis Report
Fiserv, Inc. (FISV) : Free Stock Analysis Report
Paysafe Limited (PSFE) : Free Stock Analysis Report
Bread Financial Holdings, Inc. (BFH) : Free Stock Analysis Report
