Bread Financial Holdings Inc (NYSE: BFH) shares advanced 2.8% on Tuesday following an upgrade from Wolfe Research, which raised its rating from Peer Perform to Outperform.
Analyst Darrin Peller set a new price target of $130, down from the prior $135, reflecting a valuation of 1.6 times the estimated 2027 tangible book value per share, compared with the previous 1.8 times multiple. The adjustment follows a significant rerating of the stock as the company progresses in its transformation phase.
Peller highlighted expectations for near-term estimate upgrades driven by accelerating growth, disciplined expense control, and improving credit conditions. The firm’s investment thesis is anchored in Bread Financial’s ability to compound tangible book value at a double-digit pace over the medium term.
The analyst also projected a normalized return on tangible common equity (ROTCE) exceeding 20%, suggesting potential multiple expansion despite the lower price target. Wolfe Research described the company’s transformation as being in an intermediate-to-advanced stage, with continued progress expected in its operational and financial metrics.
