Alliance Data Jumps

Shares of Alliance Data Systems (ADS) jumped this morning on news that ValueAct Capital, an activist investor, has taken a 6.8% stake in the company.

Activist investor ValueAct Capital Management LP disclosed Monday that it had bought a 6.8% stake in Alliance Data Systems Corp. and intends to begin discussions with the customer loyalty program operator over how to increase shareholder value.

Shares of the company, which operates loyalty programs and private-label credit cards, rose 2.5% to $205.99 in premarket trading. So far this year, the company’s stock has fallen 27%.

ValueAct said in regulatory filings that it holds 4 million shares, which it says are undervalued.

The activist investor plans to hold talks with management and the company’s board over potentially adding a ValueAct representative to the board and other topics related to the company’s business.

The shares got a nice pop this morning and have settled at $210.39.

big07112016

Posted by on July 11th, 2016 at 4:38 pm


The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.