COLUMBUS, Ohio - Bread Financial Holdings, Inc. (NYSE: BFH), a company specializing in personalized payment, lending, and saving solutions, has released its latest performance figures. The data indicates a slight decrease in the company's net loss rate, which is now at 7.9% for the month ended October 31, 2024, compared to 8.0% for the same period last year.
The end-of-period credit card and other loans stood at $17,915 million as of October 31, 2024, showing a slight decrease from $18,386 million at the end of October 2023. Additionally, the average credit card and other loans experienced a year-over-year decline of 6%.
Delinquency rates also saw a minor improvement, with 30 days plus delinquencies at $1,056 million as of October 31, 2024, down from $1,103 million the previous year. This represents a delinquency rate of 6.4%, a small reduction from the 6.5% reported at the same time in 2023.
Bread Financial has attributed the changes in net principal losses and net loss rate for the fourth quarter of 2024 to the impact of hurricanes Helene and Milton. The company has frozen delinquency progression for cardholders in the Federal Emergency Management Agency identified impact zones. This adjustment is expected to result in slightly lower net principal losses and net loss rate for the fourth quarter of 2024, with an anticipated offsetting increase in these figures for the second quarter of 2025.
The company, headquartered in Columbus (WA:CLC), Ohio, emphasizes its commitment to sustainable business practices and is powered by approximately 7,000 global associates.
This performance update is based on a press release statement and presents a snapshot of Bread Financial's credit performance, offering key insights into the company's financial health as of late October 2024.
In other recent news, Bread Financial announced its Q3 2024 results, showing an adjusted net income of $93 million and adjusted diluted EPS of $1.83. Despite a slight decline in total credit sales and a 5% decrease in revenue, the company's tangible book value per share increased by 12% year-over-year. The company also enhanced its balance sheet strength through a strategic repurchase of convertible notes.
In the face of economic challenges and recent hurricanes, Bread Financial remains committed to supporting affected communities, maintaining a strong CET1 ratio of 13.3%, and is cautiously optimistic about the future. Analysts noted that the company is anticipating a gradual economic recovery while carefully monitoring regulatory changes.
Bread Financial projects that average loans and total revenue will decline in low single digits for 2024, while adjusted expenses are expected to decrease relative to 2023. Despite a decrease in revenue and credit sales, as well as increased delinquency rates, the financial services provider is focused on achieving financial targets and responsible growth. These recent developments underline Bread Financial's strategic approach to navigating the complex economic landscape.
InvestingPro Insights
Bread Financial Holdings, Inc. (NYSE: BFH) has shown resilience in a challenging economic environment, as evidenced by its recent performance figures. To provide a more comprehensive view of the company's financial health, let's delve into some additional insights from InvestingPro.
Despite the slight decrease in end-of-period credit card and other loans, Bread Financial's market capitalization stands at $2.8 billion, reflecting investor confidence in the company's long-term prospects. The company's P/E ratio of 9 suggests that it may be undervalued compared to industry peers, potentially offering an attractive entry point for investors.
InvestingPro Tips highlight that Bread Financial has maintained dividend payments for 9 consecutive years, demonstrating a commitment to shareholder returns even in the face of economic headwinds. This consistency aligns with the company's focus on sustainable business practices mentioned in the article.
Moreover, the stock has shown impressive momentum, with a substantial price uptick over the last six months. This positive trend is further supported by the InvestingPro Data showing a remarkable 109.13% price total return over the past year, significantly outperforming broader market indices.
However, it's worth noting that InvestingPro Tips also indicate that Bread Financial suffers from weak gross profit margins and expects a drop in net income this year. These factors may explain the company's efforts to manage its loan portfolio and delinquency rates carefully, as detailed in the original article.
For investors seeking a more comprehensive analysis, InvestingPro offers 9 additional tips for Bread Financial, providing a deeper understanding of the company's financial position and future prospects.
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