Piper Jaffray Removes Alliance Data Systems (ADS) from Alpha List; Reiterates Buy

Piper Jaffray removes Alliance Data Systems (NYSE: ADS) from its Alpha List while maintaining a Buy. The firm has a $74 price target on shares of ADS.

After placing Alliance Data Systems on its Alpha List on April 18 due to several positive near-term catalysts likely approaching, the firm now believes that each of these catalysts have been met. The catalysts stated in the earlier research report were:

1. a solid 1Q08 and positive outlook on earnings
   
2. increased visibility with shareholders
   
3. a continued shift from risk-arb investors to a more traditional value/growth investor base
   
4. share repurchases

Although Piper sees less immediate upside from here, the firm still remains bullish on shares of Alliance Data Systems due to strong earnings prospects and continued buybacks.

Even though shares of Alliance Data Systems are up about 16% from when Piper put it on its Alpha List, the firm's $74 price target still represents a potential gain of about 23% from yesterday's closing price of $60.00.

Alliance Data Systems Corporation, together with its subsidiaries, provides data-driven and transaction-based marketing and customer loyalty solutions.

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