Cushion your portfolio in 2025 with these fixed income assets. Where to put your cash to work
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jan 15 2025
0mins
Source: CNBC
Interest Rates and Investment Opportunities: Investors are adapting to "higher for longer" interest rates, with the Federal Reserve reducing its expectations for rate cuts in 2025, leading to attractive yields on short-duration instruments like money market funds and Treasury bills.
Diversification and Fixed Income Strategies: Financial advisors recommend diversifying fixed income portfolios by including short-duration assets such as bank loans and collateralized loan obligations (CLOs), while also maintaining a balanced approach to risk and long-term goals.
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Analyst Views on BFH
Wall Street analysts forecast BFH stock price to rise
12 Analyst Rating
5 Buy
4 Hold
3 Sell
Hold
Current: 74.490
Low
64.00
Averages
83.25
High
98.00
Current: 74.490
Low
64.00
Averages
83.25
High
98.00
About BFH
Bread Financial Holdings, Inc. is a tech-forward financial services company, which is engaged in providing simple, personalized payment, lending, and saving solutions. The Company's product offerings consist of private label and co-brand credit card programs with retailers and other brand partners; direct-to-consumer (DTC) credit cards; Bread Pay products; and Bread Savings products. Its payment solutions, including Bread Financial general purpose credit cards and savings products. Its private label credit cards are partner-branded credit cards used by consumers for the purchase of goods and services from that partner. Bread Pay is its payment technology solution for pay-over-time products. The Company's products are supported by various services and capabilities, including risk management, account origination and funding services; credit card and other loan processing and servicing; fraud prevention; marketing, and data and analytics; and digital and mobile capabilities.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Personalized Rewards: The revamped myAcademy Rewards program offers personalized rewards and exclusive savings for every member, ensuring that customers can easily gain value whether shopping online, via the app, or in-store, thereby driving sales growth.
- Digital Ecosystem Enhancement: Academy has upgraded its entire digital platform, making it easier for members to sign up, track progress, view rewards, and redeem them across various channels, which enhances user experience and increases customer retention.
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Academy Launches New Loyalty Program and Credit Card
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- Rich Member Benefits: The new program offers a $15 welcome bonus, a $15 birthday reward, and a $25 reward for spending $500 annually, aimed at attracting more family customers, enhancing brand loyalty, and driving sales growth.
- Digital Ecosystem Enhancement: Academy has upgraded its digital platform, making it easier for members to sign up, track progress, view rewards, and redeem online, thereby improving user experience and increasing customer engagement.
- Family-Centric Value Proposition: This program is designed for the “Always Game Family,” emphasizing the ability to enjoy outdoor fun without financial strain, reflecting Academy's deep understanding and commitment to customer needs.
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See More
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- Major Index Volatility: The drop in financial stocks may exert pressure on major indices, especially ahead of economic data releases, as uncertainty regarding future interest rate policies intensifies.
- Investor Reaction: The pre-bell sell-off in financial stocks may stem from expectations of an economic slowdown, leading to a cautious market sentiment that affects short-term investment decisions.
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See More
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- Flexible Financing Options: The new financing program offers flexible options designed to increase customer accessibility to subscriptions, parts, and services, while also enhancing customer loyalty through a rewards mechanism, thereby driving sales growth.
- Enhanced Customer Experience: According to Rick Cunningham, Senior Vice President of Strategy at Bread Financial, this program is designed to bring immediate value and flexibility to Ford customers, creating a more seamless ownership experience that further boosts customer satisfaction.
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See More
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- Loyalty Program Upgrade: Academy Sports + Outdoors has launched the new myAcademy Rewards Mastercard® credit card, allowing members to earn a 5% discount and unlimited 2% rewards on purchases, aimed at enhancing customer shopping experiences and brand loyalty.
- Personalized Rewards: The revamped myAcademy Rewards program offers personalized rewards and exclusive savings for every member, ensuring that customers can easily gain value whether shopping online, via the app, or in-store, thereby driving sales growth.
- Digital Ecosystem Enhancement: Academy has upgraded its entire digital platform, making it easier for members to sign up, track progress, view rewards, and redeem them across various channels, which enhances user experience and increases customer retention.
- Family-Centric Strategy: This program is specifically designed for the “Always Game Family,” aiming to provide high-value outdoor gear that helps families enjoy fun without exceeding their budgets, thereby strengthening the brand's competitive position in the market.
See More
Academy Launches New Loyalty Program and Credit Card
- Loyalty Program Upgrade: Academy Sports + Outdoors has launched the new myAcademy Rewards Mastercard® credit card, allowing members to earn a 5% discount and unlimited 2% rewards on purchases, directly deposited into their myAcademy Rewards account, significantly enhancing customer shopping experience and loyalty.
- Rich Member Benefits: The new program offers a $15 welcome bonus, a $15 birthday reward, and a $25 reward for spending $500 annually, aimed at attracting more family customers, enhancing brand loyalty, and driving sales growth.
- Digital Ecosystem Enhancement: Academy has upgraded its digital platform, making it easier for members to sign up, track progress, view rewards, and redeem online, thereby improving user experience and increasing customer engagement.
- Family-Centric Value Proposition: This program is designed for the “Always Game Family,” emphasizing the ability to enjoy outdoor fun without financial strain, reflecting Academy's deep understanding and commitment to customer needs.
See More
Federal Reserve's Rate Pause Attracts Short-Duration Asset Investments
- Attraction of Short-Term Assets: The Federal Reserve's decision to maintain the federal funds rate between 3.5% and 3.75% and the expectation of one rate cut this year keeps yields on short-term Treasuries and high-quality bonds at levels not seen in many years, drawing investor interest towards short-duration assets.
- Surge in Bond ETF Inflows: Ultra-short bond ETFs have seen $85 billion in inflows over the past 12 months, making them the leading category for new investments among fixed-income ETFs, indicating a strong market appetite for short-term debt instruments.
- Popularity of Bank Loans: Bank loans, also known as senior loans, have gained traction among retail investors due to their high yields and increased ETF issuance, with the T. Rowe Price Floating Rate ETF offering a 30-day SEC yield of 6.51%, showcasing their appeal.
- Stable Cash Asset Yields: Although the annual percentage rates for money market funds have fallen below 4%, they still provide relatively stable income, with the Crane 100 list showing an annualized seven-day yield of 3.47%, offering investors a safe income option.
See More
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- Stagflation Risks: The U.S. economy faces stagflation risks, with February's Producer Price Index (PPI) rising 3.4% year-over-year and core PPI at 3.9%, intensifying concerns over low growth and high inflation, which has led to increased market volatility.
- Increased Market Volatility: The CBOE Volatility Index (VIX) recently reached about 23, indicating rising market uncertainty and heightened investor fear, particularly in the small-cap sector where investors are favoring high-quality stocks with cash returns.
- Small Cap Screening: Bank of America identified small-cap stocks in the top quintile for both value and quality, focusing on companies that have paid dividends or reduced share counts over the past 12 months to mitigate potential stagflation risks.
- Stock Performance: Bread Financial is rated a buy, despite being down 12% from its recent high, it has risen 1.5% this month; Progyny is down 37% but up 2% this week, indicating potential opportunities in small-cap stocks amid market uncertainty.
See More
Financial Stocks Decline Pre-Bell
- Market Sentiment Dips: Financial stocks were broadly declining pre-bell on Wednesday, reflecting investor concerns about market outlook, which could lead to capital outflows from the financial sector and impact overall market performance.
- Major Index Volatility: The drop in financial stocks may exert pressure on major indices, especially ahead of economic data releases, as uncertainty regarding future interest rate policies intensifies.
- Investor Reaction: The pre-bell sell-off in financial stocks may stem from expectations of an economic slowdown, leading to a cautious market sentiment that affects short-term investment decisions.
- Sector Impact: The decline in the financial sector could affect earnings expectations for related companies, particularly those reliant on rising interest rates, potentially putting further pressure on stock prices.
See More
Ford Partners with Bread Financial for Co-Branded Credit Card Program
- Partnership Agreement: Ford Motor Company has entered into a long-term agreement with Bread Financial to launch a co-branded credit card and installment loan program, aimed at providing customers with personalized payment, lending, and saving solutions to enhance their financial service experience.
- Flexible Financing Options: The new financing program offers flexible options designed to increase customer accessibility to subscriptions, parts, and services, while also enhancing customer loyalty through a rewards mechanism, thereby driving sales growth.
- Enhanced Customer Experience: According to Rick Cunningham, Senior Vice President of Strategy at Bread Financial, this program is designed to bring immediate value and flexibility to Ford customers, creating a more seamless ownership experience that further boosts customer satisfaction.
- Market Reaction: In pre-market trading on the NYSE, shares of Bread Financial fell by 0.68% to $71.97, reflecting the market's initial response to the new partnership and investor sentiment regarding the collaboration.
See More
