Discover Financial Services (DFS) Downgraded by Zacks Investment Research to “Hold”
According to Zacks, “Discover Financial shares have outperformed Zacks categorized Consumer Loan industry year to date. The company's third quarter earnings per share beat the Zacks Consensus Estimate mainly on higher revenues. The company remains well positioned for growth given its strength in credit card business. The U.S. consumer finance industry remains healthy amid a declining unemployment and improving housing sector. Discover Financial, with strong brand recognition, product innovation and customer acquisition strategies, will continue to benefit from the broader favorable trends. Management anticipates total loan portfolio which comprises credit card loans, personal loans and private student loans to grow in the range of 4–6% for 2016. However, stiff competition, lawsuit damages and regulatory challenges as well as weakness in the Payment Services segment and escalating expenses remain headwinds.”
A number of other research firms also recently commented on DFS. JMP Securities upped their price objective on Discover Financial Services from $63.00 to $71.00 and gave the stock a market outperform rating in a report on Tuesday, November 22nd. Stephens initiated coverage on Discover Financial Services in a report on Friday, November 18th. They issued an underweight rating and a $62.00 price target for the company. Jefferies Group increased their price target on Discover Financial Services from $66.00 to $70.00 and gave the company a buy rating in a report on Thursday, September 1st. Barclays PLC downgraded Discover Financial Services from an overweight rating to an equal weight rating in a report on Wednesday, September 7th. Finally, Deutsche Bank AG reiterated a buy rating and issued a $63.00 price target on shares of Discover Financial Services in a report on Thursday, August 18th. One investment analyst has rated the stock with a sell rating, seven have assigned a hold rating, sixteen have assigned a buy rating and three have assigned a strong buy rating to the stock. The company currently has an average rating of Buy and an average target price of $64.54.
Shares of Discover Financial Services (NYSE:DFS) opened at 67.75 on Monday. The stock has a market capitalization of $26.72 billion, a P/E ratio of 12.33 and a beta of 1.39. The firm’s 50-day moving average price is $59.64 and its 200-day moving average price is $57.23. Discover Financial Services has a one year low of $42.86 and a one year high of $68.88.
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The company also recently announced a quarterly dividend, which was paid on Thursday, November 17th. Shareholders of record on Thursday, November 3rd were given a dividend of $0.30 per share. This represents a $1.20 dividend on an annualized basis and a yield of 1.77%. The ex-dividend date was Tuesday, November 1st. Discover Financial Services’s dividend payout ratio is 21.74%.
In other Discover Financial Services news, CFO R. Mark Graf sold 25,032 shares of the business’s stock in a transaction on Thursday, October 27th. The shares were sold at an average price of $56.78, for a total transaction of $1,421,316.96. Following the completion of the transaction, the chief financial officer now owns 116,052 shares of the company’s stock, valued at approximately $6,589,432.56. The transaction was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. Also, EVP Diane E. Offereins sold 10,000 shares of the business’s stock in a transaction on Monday, October 3rd. The stock was sold at an average price of $56.45, for a total transaction of $564,500.00. Following the transaction, the executive vice president now directly owns 308,962 shares of the company’s stock, valued at approximately $17,440,904.90. The disclosure for this sale can be found here. Company insiders own 1.07% of the company’s stock.
A number of hedge funds and other institutional investors have recently added to or reduced their stakes in the company. Financial Architects Inc raised its position in Discover Financial Services by 724.6% in the second quarter. Financial Architects Inc now owns 1,880 shares of the financial services provider’s stock worth $100,000 after buying an additional 1,652 shares in the last quarter. Evercore Wealth Management LLC raised its position in shares of Discover Financial Services by 24.9% in the second quarter. Evercore Wealth Management LLC now owns 1,989 shares of the financial services provider’s stock worth $107,000 after buying an additional 396 shares in the last quarter. Acrospire Investment Management LLC raised its position in shares of Discover Financial Services by 18.8% in the third quarter. Acrospire Investment Management LLC now owns 1,900 shares of the financial services provider’s stock worth $107,000 after buying an additional 300 shares in the last quarter. Cable Hill Partners LLC raised its position in shares of Discover Financial Services by 112.1% in the third quarter. Cable Hill Partners LLC now owns 1,926 shares of the financial services provider’s stock worth $109,000 after buying an additional 1,018 shares in the last quarter. Finally, Mycio Wealth Partners LLC raised its position in shares of Discover Financial Services by 43.7% in the second quarter. Mycio Wealth Partners LLC now owns 2,054 shares of the financial services provider’s stock worth $110,000 after buying an additional 625 shares in the last quarter. 83.54% of the stock is owned by hedge funds and other institutional investors.
About Discover Financial Services
Discover Financial Services (DFS) is a direct banking and payment services company. The Company is a bank holding company, as well as a financial holding company. The Company operates through two segments: Direct Banking, which includes consumer banking and lending products, specifically Discover-branded credit cards issued to individuals and small businesses on the Discover Network and other consumer banking products and services, including personal loans, home equity loans, and other consumer lending and deposit products, and Payment Services segment, which includes PULSE and its Network Partners business.
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