Bread Financial (NYSE:BFH) Issues Quarterly Earnings Results, Beats Estimates By $0.50 EPS

Bread Financial (NYSE:BFH) posted its quarterly earnings results on Thursday. The company reported $3.84 EPS for the quarter, topping the consensus estimate of $3.34 by $0.50, FiscalAI reports. Bread Financial had a net margin of 11.19% and a return on equity of 17.24%. The company had revenue of $1.02 billion for the quarter, compared to the consensus estimate of $1.01 billion. During the same quarter last year, the firm posted $4.02 EPS. The firm’s revenue was up 4.7% compared to the same quarter last year.

Here are the key takeaways from Bread Financial’s conference call:

• Loan growth and revenue remained strong: Third-quarter end-of-period loans rose 7% to $18.9 billion, credit sales increased 9%, and revenue grew 5% year over year. Management cited new partnerships, general-purpose spending, and momentum in furniture and installment-loan programs.
• Credit performance improved: The net credit loss rate declined 99 basis points year over year to 6.40%, while delinquencies fell 47 basis points to 5.57%. Bread raised its 2026 net loss rate outlook for the second consecutive quarter, now expecting 6.9%–7.0%.
• Funding and balance-sheet strength advanced: Consumer deposits increased 21% to $9.9 billion and represented 53% of total funding, while the completed bank merger is expected to provide additional deposit-growth and capital efficiencies. Moody’s also upgraded the company’s credit rating.
• Partner momentum and shareholder returns continued: Bread renewed long-term agreements with Signet Jewelers and Sephora, repurchased $75 million of stock, and increased its quarterly dividend by 9%. Management also highlighted opportunities from technology, analytics, and AI investments.
• Some profitability headwinds remain: Management expects fourth-quarter net interest margin to decline modestly because of seasonality, lower billed late fees, and deposit-rate pressure, while the evolving product mix may weigh on margins. Fourth-quarter buybacks are expected to be minimal as capital is directed toward seasonal loan growth.

Bread Financial Stock Down 2.7%

NYSE:BFH opened at $99.72 on Friday. Bread Financial has a 1-year low of $59.26 and a 1-year high of $114.53. The company has a 50-day moving average of $104.36 and a 200 day moving average of $98.67. The firm has a market cap of $3.83 billion, a PE ratio of 7.86, a price-to-earnings-growth ratio of 0.81 and a beta of 1.15. The company has a debt-to-equity ratio of 0.24, a current ratio of 1.16 and a quick ratio of 1.17.

Bread Financial Increases Dividend

The firm also recently disclosed a quarterly dividend, which will be paid on Tuesday, December 15th. Investors of record on Monday, November 30th will be paid a $0.25 dividend. This represents a $1.00 dividend on an annualized basis and a yield of 1.0%. This is a boost from Bread Financial’s previous quarterly dividend of $0.23. The ex-dividend date of this dividend is Monday, November 30th. Bread Financial’s payout ratio is currently 7.18%.

Insider Transactions at Bread Financial

In other Bread Financial news, Director Praniti Lakhwara sold 2,802 shares of the firm’s stock in a transaction dated Tuesday, July 28th. The shares were sold at an average price of $106.12, for a total transaction of $297,348.24. Following the transaction, the director owned 4,458 shares of the company’s stock, valued at approximately $473,082.96. This trade represents a 38.60% decrease in their position. The transaction was disclosed in a document filed with the SEC, which is available at this hyperlink. 1.30% of the stock is currently owned by insiders.

Key Headlines Impacting Bread Financial

Here are the key news stories impacting Bread Financial this week:

• Positive Sentiment: Q3 earnings exceeded expectations: Bread Financial reported adjusted earnings of $3.84 per share, beating the $3.34 consensus estimate, while revenue rose 4.7% year over year to $1.02 billion, slightly above expectations. Q3 revenue report
• Positive Sentiment: Dividend increased: The company raised its quarterly common-stock dividend 8.7% to $0.25 per share, payable December 15 to shareholders of record November 30. The board also declared dividends on both series of preferred stock, signaling continued shareholder returns. Dividend announcement
• Positive Sentiment: Sephora partnership renewed: Bread Financial signed a long-term renewal with Sephora to support its credit-card and loyalty program, preserving an important branded payments relationship. Sephora renewal
• Neutral Sentiment: Analyst target raised, but rating remains Hold: TD Cowen increased its price target from $111 to $113, implying substantial upside from recent levels, while maintaining a “hold” recommendation.
• Neutral Sentiment: 2026 revenue outlook is in line: Bread Financial reiterated revenue guidance of approximately $4.0 billion, matching consensus and offering limited evidence of an upside forecast revision.
• Negative Sentiment: Year-over-year earnings declined: Q3 earnings fell from $4.02 per share a year earlier to $3.84, tempering the impact of the earnings beat and raising questions about profitability trends.
• Negative Sentiment: Credit performance remains a focus: Bread Financial issued a September update covering net principal loss and delinquency rates. Investors will scrutinize those metrics because deterioration could increase provisions and pressure future earnings. September performance update

Analyst Ratings Changes

A number of equities analysts have commented on the stock. TD Cowen upped their target price on shares of Bread Financial from $111.00 to $113.00 and gave the stock a “hold” rating in a research note on Friday. Wall Street Zen raised shares of Bread Financial from a “hold” rating to a “buy” rating in a research report on Saturday. Weiss Ratings reaffirmed a “buy (b)” rating on shares of Bread Financial in a research note on Thursday. Royal Bank Of Canada reaffirmed a “sector perform” rating and set a $115.00 price target on shares of Bread Financial in a research note on Friday, July 24th. Finally, Wolfe Research upgraded Bread Financial from a “peer perform” rating to an “outperform” rating and set a $130.00 price target for the company in a report on Tuesday, August 25th. Eight research analysts have rated the stock with a Buy rating, seven have issued a Hold rating and one has issued a Sell rating to the stock. Based on data from MarketBeat.com, Bread Financial presently has a consensus rating of “Hold” and an average price target of $112.21.

About Bread Financial

Bread Financial Holdings, Inc (NYSE: BFH) is a financial services company that provides payment, lending and savings solutions to consumers and businesses. Its offerings include private-label and co-branded credit cards, installment lending, buy now, pay later services and deposit products.

The company operates through its Bread platform, which supports merchants with financing options, payment processing and customer loyalty solutions. Its consumer products have included Bread Cashback credit cards, Bread Pay installment payment services and Bread Savings deposit accounts.

Bread Financial primarily serves consumers and merchants in the United States, with solutions designed for retail, travel, home improvement and other industries.