Discover Financial Services (DFS) Expected to Post Earnings of $2.05 Per Share

Wall Street analysts expect that Discover Financial Services (NYSE:DFS) will announce earnings of $2.05 per share for the current fiscal quarter, according to Zacks. Five analysts have provided estimates for Discover Financial Services’ earnings. The lowest EPS estimate is $2.00 and the highest is $2.13. Discover Financial Services posted earnings per share of $1.59 during the same quarter last year, which would indicate a positive year over year growth rate of 28.9%. The business is scheduled to report its next earnings results after the market closes on Thursday, October 25th.

According to Zacks, analysts expect that Discover Financial Services will report full-year earnings of $7.83 per share for the current financial year, with EPS estimates ranging from $7.73 to $7.95. For the next financial year, analysts expect that the firm will post earnings of $8.69 per share, with EPS estimates ranging from $8.41 to $8.88. Zacks’ EPS calculations are a mean average based on a survey of sell-side research analysts that that provide coverage for Discover Financial Services.

Discover Financial Services (NYSE:DFS) last announced its quarterly earnings data on Thursday, July 26th. The financial services provider reported $1.91 earnings per share for the quarter, topping the Thomson Reuters’ consensus estimate of $1.88 by $0.03. Discover Financial Services had a net margin of 19.07% and a return on equity of 24.25%. The company had revenue of $2.60 billion during the quarter, compared to analyst estimates of $2.63 billion. During the same period last year, the business earned $1.40 EPS. The firm’s revenue for the quarter was up 7.6% compared to the same quarter last year.

A number of research firms have commented on DFS. Zacks Investment Research downgraded shares of Discover Financial Services from a “buy” rating to a “hold” rating in a research report on Tuesday. JPMorgan Chase & Co. lifted their price objective on shares of Discover Financial Services from $78.00 to $81.00 and gave the stock a “neutral” rating in a research note on Friday, July 27th. Sandler O’Neill reaffirmed a “buy” rating and issued a $87.00 price objective on shares of Discover Financial Services in a research note on Friday, July 27th. Finally, Bank of America lifted their price objective on shares of Discover Financial Services from $86.00 to $92.00 and gave the stock a “buy” rating in a research note on Friday, September 21st. Nine equities research analysts have rated the stock with a hold rating, fourteen have assigned a buy rating and one has given a strong buy rating to the stock. The stock presently has a consensus rating of “Buy” and a consensus target price of $86.76.

In other news, CEO David W. Nelms sold 30,000 shares of Discover Financial Services stock in a transaction that occurred on Tuesday, September 4th. The shares were sold at an average price of $78.11, for a total value of $2,343,300.00. Following the transaction, the chief executive officer now directly owns 1,210,798 shares of the company’s stock, valued at $94,575,431.78. The transaction was disclosed in a legal filing with the SEC, which is accessible through this hyperlink. Also, EVP Carlos Minetti sold 3,750 shares of Discover Financial Services stock in a transaction that occurred on Tuesday, September 4th. The stock was sold at an average price of $78.21, for a total transaction of $293,287.50. Following the completion of the transaction, the executive vice president now directly owns 133,852 shares in the company, valued at $10,468,564.92. The disclosure for this sale can be found here. Over the last three months, insiders sold 101,250 shares of company stock worth $7,663,313. 0.81% of the stock is currently owned by insiders.

Several institutional investors have recently added to or reduced their stakes in the company. Sandy Spring Bank grew its holdings in shares of Discover Financial Services by 181.5% in the 2nd quarter. Sandy Spring Bank now owns 1,689 shares of the financial services provider’s stock worth $119,000 after purchasing an additional 1,089 shares during the last quarter. Migdal Insurance & Financial Holdings Ltd. grew its holdings in shares of Discover Financial Services by 8,341.7% in the 2nd quarter. Migdal Insurance & Financial Holdings Ltd. now owns 2,026 shares of the financial services provider’s stock worth $143,000 after purchasing an additional 2,002 shares during the last quarter. Private Capital Group LLC grew its holdings in shares of Discover Financial Services by 8,258.3% in the 1st quarter. Private Capital Group LLC now owns 2,006 shares of the financial services provider’s stock worth $144,000 after purchasing an additional 1,982 shares during the last quarter. Edge Wealth Management LLC bought a new stake in shares of Discover Financial Services in the 2nd quarter worth about $155,000. Finally, Moneta Group Investment Advisors LLC grew its holdings in shares of Discover Financial Services by 440.1% in the 2nd quarter. Moneta Group Investment Advisors LLC now owns 6,670 shares of the financial services provider’s stock worth $157,000 after purchasing an additional 5,435 shares during the last quarter. 85.76% of the stock is currently owned by institutional investors and hedge funds.

Shares of DFS stock traded up $1.09 during midday trading on Friday, reaching $76.03. 2,114,500 shares of the company were exchanged, compared to its average volume of 2,075,290. Discover Financial Services has a 12 month low of $63.31 and a 12 month high of $81.93. The company has a market capitalization of $26.00 billion, a price-to-earnings ratio of 12.71, a price-to-earnings-growth ratio of 0.78 and a beta of 1.51. The company has a current ratio of 1.49, a quick ratio of 1.49 and a debt-to-equity ratio of 2.54.

The firm also recently disclosed a quarterly dividend, which will be paid on Thursday, December 6th. Stockholders of record on Wednesday, November 21st will be paid a $0.40 dividend. This represents a $1.60 annualized dividend and a dividend yield of 2.10%. Discover Financial Services’s dividend payout ratio is currently 26.76%.

Discover Financial Services declared that its Board of Directors has initiated a stock buyback program on Thursday, July 19th that allows the company to repurchase $3.00 billion in outstanding shares. This repurchase authorization allows the financial services provider to buy up to 11.9% of its shares through open market purchases. Shares repurchase programs are generally a sign that the company’s board of directors believes its stock is undervalued.

About Discover Financial Services

Discover Financial Services, through its subsidiaries, operates as a direct banking and payment services company in the United States. The Direct Banking segment offers Discover-branded credit cards to individuals; and other consumer products and services, including private student loans, personal loans, home equity loans, and other consumer lending, as well as deposit products, such as certificates of deposit, money market accounts, savings accounts, checking accounts, and individual retirement arrangement certificates of deposit.

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