From Gross to Net at Alliance Data Systems

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Margins matter. The more Alliance Data Systems (NYSE: ADS) keeps of each buck it earns in revenue, the more money it has to invest in growth, fund new strategic plans, or (gasp!) distribute to shareholders. Healthy margins often separate pretenders from the best stocks in the market. That's why I check on my holdings' margins at least once a quarter. I'm looking for the absolute numbers, comparisons to sector peers and competitors, and any trend that may tell me how strong Alliance Data Systems' competitive position could be.

Here's the current margin snapshot for Alliance Data Systems and some of its sector and industry peers and direct competitors.

Company

TTM Gross Margin

TTM Operating Margin

TTM Net Margin

 Alliance Data Systems

31.9%

22.1%

7.6%

 Western Union (NYSE: WU)

42.8%

24.6%

16.2%

 Total System Services (NYSE: TSS)

49.0%

20.1%

12.6%

 Fidelity National Information Services (NYSE: FIS)

27.8%

14.4%

4.2%

Source: Capital IQ, a division of Standard & Poor's. TTM