Bread Financial Holdings (BFH) AI Stock Analysis

• Market Cap: $2.86B
• Dividend Yield: 1.39%
• Average Volume (3M): 796.28K
• Price to Earnings (P/E): 6.4
• Beta (1Y): 1.31
• Revenue Growth: -4.32%
• EPS Growth: 58.34%
• Country: US
• Employees: 6,000
• Sector: Financial
• Sector Strength: 70
• Industry: Financial - Credit Services
• EPS (TTM): 4.02
• Shares Outstanding: 45,661,602
• 10 Day Avg. Volume: 932,266
• 30 Day Avg. Volume: 796,278
• PEG Ratio: -0.18
• Price to Book (P/B): 0.99
• Price to Sales (P/S): 0.63
• P/FCF Ratio: 1.63
• Enterprise Value/Market Cap: 0.93
• Enterprise Value/Revenue: 0.57
• Enterprise Value/Gross Profit: 1.45
• Enterprise Value/Ebitda: 4.26
• 1Y Price Target: $67.60
• Price Target Upside: 8.02% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 11
• EPS Forecast (FY): 9.99
• Revenue Forecast (FY): $3.83B

• Rating: 71 Outperform
• Price Target: $72.00 ▲(15.05% Upside)

Bread Financial Holdings receives a solid overall score driven by strong earnings call results and positive technical indicators. The company's strategic initiatives and financial resilience are significant strengths. However, challenges such as high leverage and declining revenue growth temper the outlook. The stock's valuation remains reasonable, supporting its investment appeal.

Positive Factors

Cash Flow Generation

Positive cash flow growth indicates strong cash generation ability, supporting ongoing investments and shareholder returns.

Strategic Partnerships

New partnerships in the home vertical enhance market position and diversify revenue streams, supporting long-term growth.

Dividend Increase

Increasing dividends reflects confidence in cash flow stability and commitment to returning capital to shareholders.

Negative Factors

High Leverage

Significant leverage can strain financial flexibility and increase risk, impacting long-term financial health.

Declining Revenue Growth

Declining revenue growth may indicate challenges in market expansion and could pressure future earnings potential.

Elevated Net Loss Rates

High net loss rates can impact profitability and signal underlying credit risk, affecting long-term financial performance.

Bread Financial Holdings Business Overview & Revenue Model

Company Description

Bread Financial Holdings, Inc. provides tech-forward payment and lending solutions to customers and consumer-based industries in North America. It offers credit card and other loans financing services, including risk management solutions, account origination, and funding services for approximately 130 private label and co-brand credit card programs, as well as through Bread partnerships to approximately 500 small-and medium-sized businesses merchants; and Comenity-branded general purpose cash-back credit. The company also manages and services the loans it originates for private label, co-brand, and general-purpose credit card programs and Bread BNPL (installment loans, split-pay) products; and provides marketing, and data and analytics services. In addition, it offers an enhanced digital suite that includes a unified software development kit, which provides access to its suite of products, as well as promotes credit payment options earlier in the shopping experience. Further, the company through Bread, a digital payments platform and robust suite of application programming interfaces allows merchants and partners to integrate online point-of-sale financing and other digital payment products, including installment and split-pay solutions. The company was formerly known as Alliance Data Systems Corporation and changed its name to Bread Financial Holdings, Inc. in March 2022. Bread Financial Holdings, Inc. was founded in 1996 and is headquartered in Columbus, Ohio.

How the Company Makes Money

Bread Financial Holdings generates revenue through multiple streams primarily centered around interest income from consumer loans and transaction fees. The company issues credit cards and provides financing solutions, earning interest on outstanding balances. Additionally, BFH benefits from merchant partnerships, where it charges transaction fees for processing payments made through its financing options. The company may also generate income from late payment fees and other ancillary services related to credit management. Key partnerships with retail and e-commerce merchants allow BFH to expand its customer base and drive volume, contributing significantly to its overall earnings.

Bread Financial Holdings Financial Statement Overview

Summary

Bread Financial Holdings shows a stable financial position with strengths in cash flow generation and profit margins. However, challenges remain with declining revenue growth and high leverage, which could impact future financial flexibility. The company should focus on improving operational efficiency and reducing debt levels to enhance financial health.

Income Statement

Bread Financial Holdings shows a mixed performance in its income statement. The TTM data indicates a decline in revenue growth, with a negative growth rate of -0.72%. However, the company maintains a stable gross profit margin of approximately 52% and a net profit margin of 6.06%, which is commendable. The EBIT and EBITDA margins are relatively low at 8.14% and 9.96%, respectively, suggesting room for improvement in operational efficiency.

Balance Sheet

The balance sheet reflects a high debt-to-equity ratio of 1.34 in the TTM period, indicating significant leverage, which could pose financial risks. The return on equity is modest at 9.23%, showing moderate profitability relative to shareholder equity. The equity ratio stands at 14.51%, suggesting a lower proportion of equity financing compared to total assets, which could affect financial stability.

Cash Flow

Cash flow analysis reveals a positive trend with a free cash flow growth rate of 3.18% in the TTM period. The operating cash flow to net income ratio is 0.14, indicating that operating cash flow adequately covers net income. Additionally, the free cash flow to net income ratio is slightly above 1, demonstrating effective cash generation relative to net income.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	4.68B	4.80B	5.17B	4.37B	3.65B	3.80B
Gross Profit	1.84B	2.44B	3.07B	2.28B	2.06B	2.03B
EBITDA	624.00M	471.00M	1.08B	413.00M	1.17B	549.00M
Net Income	472.00M	277.00M	718.00M	223.00M	801.00M	214.00M
Balance Sheet
Total Assets	21.71B	22.89B	23.14B	25.41B	21.75B	22.55B
Cash, Cash Equivalents and Short-Term Investments	4.05B	3.85B	3.76B	3.99B	3.11B	3.02B
Total Debt	0.00	5.68B	5.44B	8.13B	7.57B	8.70B
Total Liabilities	18.40B	19.84B	20.22B	23.14B	19.66B	21.03B
Stockholders Equity	3.32B	3.05B	2.92B	2.27B	2.09B	1.52B
Cash Flow
Free Cash Flow	2.00B	1.86B	1.99B	1.78B	1.46B	1.83B
Operating Cash Flow	2.00B	1.86B	1.99B	1.85B	1.54B	1.88B
Investing Cash Flow	-1.22B	-1.17B	788.00M	-5.11B	-1.69B	1.77B
Financing Cash Flow	-476.00M	-592.00M	-3.09B	3.27B	608.00M	-4.17B

Bread Financial Holdings Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 62.58
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BFH, the sentiment is Positive. The current price of 62.58 is above the 20-day moving average (MA) of 60.67, above the 50-day MA of 61.42, and above the 200-day MA of 56.32, indicating a bullish trend. The MACD of 1.08 indicates Negative momentum. The RSI at 54.13 is Neutral, neither overbought nor oversold. The STOCH value of 42.91 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BFH.

Bread Financial Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
ENVA	77 Outperform	$3.04B	11.25	23.81%	―	21.10%	76.12%
BFH	71 Outperform	$2.86B	6.37	14.81%	1.39%	-4.32%	58.34%
Sector *	68 Neutral	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
SEZL	66 Neutral	$2.09B	21.10	115.73%	―	92.95%	151.46%
WU	65 Neutral	$2.87B	3.92	97.70%	10.41%	-2.51%	17.47%
LC	64 Neutral	$2.05B	19.99	7.40%	―	9.68%	94.85%
LU	52 Neutral	$2.43B	―	―	―	―	―

Bread Financial Holdings Corporate Events

Bread Financial Announces $500M Senior Notes Offering

On October 28, 2025, Bread Financial Holdings announced the pricing of a $500 million private offering of 6.750% senior notes due 2031. The company plans to use the net proceeds of approximately $493 million, along with $275 million in cash, to redeem its outstanding 9.750% senior notes due 2029. This strategic financial move is expected to enhance Bread Financial’s debt structure and potentially improve its market position.

The most recent analyst rating on (BFH) stock is a Buy with a $72.00 price target. To see the full list of analyst forecasts on Bread Financial Holdings stock, see the BFH Stock Forecast page.

Bread Financial Announces $500M Senior Notes Offering

On October 28, 2025, Bread Financial Holdings announced a private offering of $500 million in senior notes, with the intention to use the proceeds, along with $275 million cash on hand, to redeem its outstanding 2029 Notes. This strategic move aims to manage the company’s debt obligations and is subject to market conditions, reflecting Bread Financial’s efforts to optimize its financial structure and maintain its competitive position in the financial services industry.

The most recent analyst rating on (BFH) stock is a Buy with a $72.00 price target. To see the full list of analyst forecasts on Bread Financial Holdings stock, see the BFH Stock Forecast page.

Bread Financial Reports Strong Q3 2025 Performance

Bread Financial Holdings Inc., a tech-forward financial services company, specializes in providing personalized payment, lending, and saving solutions. In its latest earnings report for the third quarter of 2025, Bread Financial announced a net income of $188 million, reflecting a significant increase from the previous year. The company’s revenue for the quarter was $971 million, with a common equity tier 1 capital ratio of 14.0% and a tangible book value per common share of $56.36.

Bread Financial’s Earnings Call Highlights Strong Performance

Bread Financial’s recent earnings call conveyed a strong and optimistic sentiment, underscored by impressive financial performance and strategic initiatives. The company reported a notable increase in net income and credit sales, supported by resilient consumer health and strategic partnerships. Despite facing challenges such as decreased average loans and elevated net loss rates, proactive measures like share repurchases, dividend increases, and a credit ratings upgrade contribute to a positive outlook.

Bread Financial Reports Q3 2025 Performance Update

On October 23, 2025, Bread Financial Holdings reported a performance update for the period ending September 30, 2025, highlighting a net loss rate of 6.9% for September and 7.4% for the quarter. The company experienced a decrease in average credit card and other loans by 2% year-over-year for September and 1% for the quarter, with a delinquency rate improvement from 6.4% in 2024 to 6.0% in 2025, indicating a positive trend in managing loan delinquencies.

The most recent analyst rating on (BFH) stock is a Hold with a $64.00 price target. To see the full list of analyst forecasts on Bread Financial Holdings stock, see the BFH Stock Forecast page.

Bread Financial Announces Strong Q3 2025 Results

On October 23, 2025, Bread Financial Holdings announced its Q3 2025 financial results, highlighting a net income of $188 million and a tangible book value per share increase of 19% to $56.36. The company declared a quarterly cash dividend of $0.23 per share and increased its share repurchase authorization by $200 million. The company also received a credit ratings upgrade from Moody’s and signed new brand partnerships in the home vertical, enhancing its market presence. Despite macroeconomic uncertainties, Bread Financial remains confident in achieving its 2025 financial targets, supported by strong capital and cash flow generation.

The most recent analyst rating on (BFH) stock is a Hold with a $64.00 price target. To see the full list of analyst forecasts on Bread Financial Holdings stock, see the BFH Stock Forecast page.

Bread Financial Reports Improved August 2025 Performance

On September 9, 2025, Bread Financial Holdings, Inc. released a performance update for August 2025, highlighting a slight decrease in both net loss and delinquency rates compared to the same period in 2024. The net loss rate decreased from 7.8% to 7.6%, and the delinquency rate dropped from 6.2% to 5.8%, indicating improved financial health and potentially strengthening the company’s position in the competitive financial services market.

The most recent analyst rating on (BFH) stock is a Buy with a $74.00 price target. To see the full list of analyst forecasts on Bread Financial Holdings stock, see the BFH Stock Forecast page.

Bread Financial Announces $200M Stock Repurchase Plan

On August 27, 2025, Bread Financial Holdings announced that its Board of Directors has approved a plan to repurchase up to $200 million of its common stock. The initiative is part of the company’s strategy to strengthen its capital position and return value to shareholders, though the repurchase is subject to market conditions and regulatory approvals.

The most recent analyst rating on (BFH) stock is a Buy with a $68.00 price target. To see the full list of analyst forecasts on Bread Financial Holdings stock, see the BFH Stock Forecast page.

Bread Financial Announces Tender Offer Results

On August 22, 2025, Bread Financial Holdings announced the expiration and results of its cash tender offers for its 9.750% Senior Notes due 2029 and 8.375% Fixed-Rate Reset Subordinated Notes due 2035. The tender offers, which expired on August 21, 2025, involved a total of $150,000,000 in aggregate principal amount, with $31,288,000 of the 2029 Notes and $121,000 of the 2035 Notes tendered. The results of these offers reflect Bread Financial’s strategic financial management and may impact its debt profile and market positioning.

The most recent analyst rating on (BFH) stock is a Buy with a $68.00 price target. To see the full list of analyst forecasts on Bread Financial Holdings stock, see the BFH Stock Forecast page.

Bread Financial Reports Improved Financial Health in Update

On August 15, 2025, Bread Financial Holdings, Inc. released a performance update for the period ending July 31, 2025. The update highlighted a decrease in both net loss and delinquency rates compared to the previous year, with the net loss rate dropping from 8.0% to 7.6% and the delinquency rate falling from 6.2% to 5.8%. These improvements suggest a positive impact on the company’s financial health and may enhance its competitive positioning in the financial services industry.

The most recent analyst rating on (BFH) stock is a Hold with a $59.00 price target. To see the full list of analyst forecasts on Bread Financial Holdings stock, see the BFH Stock Forecast page.

Bread Financial Announces Early Tender Results for Notes

On August 7, 2025, Bread Financial Holdings announced the early tender results of its cash tender offer for its 9.750% Senior Notes due 2029 and 8.375% Fixed-Rate Reset Subordinated Notes due 2035. The company reported that $28,402,000 of the 2029 Notes and $121,000 of the 2035 Notes were tendered by the early participation date. The settlement for these notes is expected on August 11, 2025, with total consideration provided for valid tenders. This move is part of Bread Financial’s strategic financial management, potentially impacting its debt structure and market positioning.

The most recent analyst rating on (BFH) stock is a Hold with a $59.00 price target. To see the full list of analyst forecasts on Bread Financial Holdings stock, see the BFH Stock Forecast page.

Bread Financial’s Earnings Call: Mixed Sentiment with Strategic Growth

Bread Financial Holdings Inc. recently held its earnings call, revealing a mixed sentiment. The company showcased strong adjusted earnings and credit sales growth, alongside successful strategic initiatives such as share repurchases and new credit card program launches. Improvements in credit metrics led to a better net loss rate outlook. However, challenges like a decline in revenue, decreased average loans, and increased noninterest expenses painted a balanced picture of the company’s financial health.