Discover remains a buy at Morgan Stanley

Strong loan growth, lower for longer credit losses, resilient NIM, and higher capital returns expected for Discover have analyst Betsey Graseck reiterating her Overweight rating and $66 price target.

Discover is taking market share, says Graseck, noting 4.2% Y/Y loan growth at the company while industry loan growth was flat. Net interest margin grew six basis points Q/Q, and lower funding costs, stronger loan growth, and lower charge-offs should keep close to that level for the next couple of years.

Previously: Discover Q1 earnings

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