Stock of the Day

Discover Financial Services (DFS)

$197.76

-$2.73 (-1.4%)

Market Cap: $49.77B

About Discover Financial Services

Discover Financial Services, through its subsidiaries, provides digital banking products and services, and payment services in the United States. It operates in two segments, Digital Banking and Payment Services.

The Digital Banking segment offers Discover-branded credit cards to individuals; personal loans, home loans, and other consumer lending; and direct-to-consumer deposit products comprising savings accounts, certificates of deposit, money market accounts, IRA certificates of deposit, IRA savings accounts and checking accounts, and sweep accounts. The Payment Services segment operates the PULSE to access automated teller machines, debit, and electronic funds transfer network; and Diners Club International, a payments network that issues Diners Club branded charge cards and/or provides card acceptance services, as well as offers payment transaction processing and settlement services. The company was incorporated in 1960 and is based in Riverwoods, Illinois.

Discover Financial Services Bull Case

Here are some ways that investors could benefit from investing in Discover Financial Services:

• The current stock price is around $191.64, which reflects a strong market position and potential for growth.
• Discover Financial Services reported a significant earnings per share of $4.25 for the latest quarter, surpassing analysts' expectations, indicating robust financial performance.
• The company has a high return on equity of 26.18%, suggesting effective management and strong profitability relative to shareholder equity.
• With a net margin of 17.29%, Discover Financial Services demonstrates efficient cost management and profitability, which can attract investors looking for stable returns.
• Recent analyst upgrades, including a price target increase from $219.00 to $229.00, indicate positive market sentiment and potential for stock appreciation.

Discover Financial Services Bear Case

Investors should be bearish about investing in Discover Financial Services for these reasons:

• The stock has experienced volatility, with a beta of 1.16, indicating that it may be more sensitive to market fluctuations compared to the overall market.
• Some analysts have downgraded their price targets, with one reducing it from $169.00 to $129.00, suggesting concerns about future performance.
• The company has a debt-to-equity ratio of 1.09, which may indicate a higher level of debt relative to equity, potentially increasing financial risk.
• Despite strong earnings, the stock's P/E ratio of 12.39 may suggest that it is undervalued, but it could also indicate that investors are cautious about future growth prospects.
• Market analysts have mixed ratings, with eight holding a "hold" rating, which may reflect uncertainty about the stock's future trajectory.

Recent News

• Capital One Awards CEO, Executives Equity Tied to Discover Deal (bloomberg.com)