Bread Financial Holdings: Focusing On Longer Growth Runways And Better Economics
Summarize this article with:
Bill Miller829 FollowersFollow5ShareSavePlay(5min)CommentsSummaryBread is a consumer finance company that partners with retailers to provide private-label and co-branded credit cards and buy now, pay later products.Management is targeting a mid-to-high single-digit loan growth rate over the long term with returns on tangible common equity in the mid-to-high 20% range.The company’s online direct-to-consumer deposits have grown at a compound annual growth rate of ~38% since the end of 2020 to $8.5B at the end of 2025.Shares are trading at a P/TBV multiple of 1.3x, or a roughly 48% discount to peers.Management has greater financial flexibility to pursue new growth opportunities and return capital to shareholders. Lemon_tm/iStock via Getty Images Price: $72.59 (3/10/26) Market Capitalization: $3.1B Enterprise Value: $3.8B What the Company Does Formerly known as Alliance Data Systems, Bread is a consumer finance company that partners with retailers to provide private-label and co-branded credit cardsThis article was written byBill Miller829 FollowersFollow[Note: Bill Miller is not an active contributor to Seeking Alpha, but rather SA editors excerpt from his quarterly letters to clients.] Bill Miller, CFA is the founder of Miller Value Partners, and currently serves as the Chairman and Chief Investment Officer, and co-Portfolio Manager for Opportunity Equity and Income Strategy. Prior to Miller Value Partners, Bill and his partner, Ernie Kiehne, founded Legg Mason Capital Management and served as portfolio managers of the Legg Mason Capital Management Value Trust from its inception in 1982. Bill took over as sole manager in December 1990 and served in this role for the next 20 years.Bill was the director of research for Legg Mason from October 1981 through June 1985 and assumed overall responsibility for Legg Mason’s equity funds management division in 1990. Prior to joining Legg Mason in 1981, he served as treasurer of the JE Baker Company, a major manufacturer of products for the steel and cement industries.Bill earned his economics degree from Washington and Lee University, where he graduated with honors in 1972. Subsequent to graduation, he served as a military intelligence officer overseas and then pursued graduate studies in philosophy in the Ph.D program at The Johns Hopkins University. He received his CFA designation in 1986.