Seeking Alpha

Discover Financial Services (DFS)

  • Tue, Aug. 25, 10:43 AM
    • Goldman Sachs analysts say the U.S. stock market correction has many more parallels with 1998 than 2008, which “suggest[s] a rebound ahead,” while predicting the S&P 500 will rise by 11% from current levels to reach 2,100 by year's end.
    • The S&P fell 19% between July and August 1998, but "ultimately, the U.S. economy was relatively unaffected by overseas financial market gyrations in 1998, and we believe a similar situation will occur in 2015," Goldman says.
    • The correlation between U.S. economic growth and Chinese growth is relatively low, Goldman says, estimating that a one percentage point drop in Chinese growth would translate into a 0.06 pp reduction in U.S. GDP.
    • The best strategy for U.S. consumers, the bank advises, is to hold companies with high domestic revenues and avoid companies with high foreign sales.
    • Goldman's list of the 25 most oversold stocks with high U.S. sales exposure: KMX, M, WFM, CHK, SWN, RRC, COG, PXD, OKE, MPC, NAVI, ETFC, LNC, BXP, KEY, RF, DFS, ANTM, CSX, NSC, UNP, JBHT, FSLR, ADS, PAYX
  • Thu, Aug. 20, 9:35 AM
    • Discover (NYSE:DFS) achieved its highest-ever score in J.D. Power's 2015 U.S. Credit Card Satisfaction Study, with 828 out of a possible 1K points.
    • It marks the first time since the survey began in 2007 that American Express (NYSE:AXP) hasn't gotten the number one ranking.
    • Discover's new security feature - allowing customers to freeze a credit card through a mobile app - helped give the company its edge, says J.D. Power.
  • Fri, Jul. 24, 3:31 PM
    • Goldman's (GS -1.8%) Q2 results confirmed the team's expectation of positive revisions to 2016 consensus EPS. Zions (ZION -0.7%) has "multiple catalysts" to reach improve profitability goals and EPS growth over the next three years.
    • Guggenheim's four key investment themes: 1) Names levered to improving M&A, with Goldman being the best idea, followed by Morgan Stanley (MS -1.3%); 2) Restructuring stories, with Zions the best idea, but First Horizon (FHN -1%), Ally Financial (ALLY -1.8%), and BofA (BAC -1.6%) also worth looking at; 3) Idiosyncratic growth stories like MasterCard (MA +0.7%), Visa (V +4.5%), Synchrony Financial (SYF -2.4%), and Signature Bank (SBNY -0.8%); 4) Names with a distinct M&A catalyst in the regionals group like BB&T (BBT -1.5%), CIT Group (CIT -1.6%), and Springleaf (LEAF -1.4%).
    • Mixed results from credit card companies affirm the team's preference for SYF, but the risk/reward at AmEx (AXP -1.4%) is improving. AmEx, CapOne (COF -13%), and Discover (DFS -2.7%) results show the boosted competition they face form the banks, which is slowing growth, and lifting marketing and rewards costs.
    • Source: Barron's
    • Previously: Capital One tumbles after earnings miss and trio of downgrades (July 24)
  • Wed, Jul. 22, 4:32 PM
    • Q2 net income of $599M or $1.33 per share vs. $644M of $1.35 one year ago. ROE of 21%.
    • Total loans of $69B up 4.8% Y/Y. Credit card loans of $54.9B up 4.2%. Discover card sales volume up 2.3%, or 5% excluding gasoline purchases.
    • Net charge-off rate for credit card loans down 5 bps from a year ago to 2.28%. Delinquency rate for loans more than 30 days past due down 8 bps to 1.55%.
    • Direct Banking pretax income of $914M slipped 7%, in part due to $42M of expenses thanks to exit from Home Loans business and anti-money laundering costs. Net interest margin of 9.63% down 22 bps from a year ago. Credit card yield of 12.04% down 6 bps.
    • Payment Services pretax income of $28M down $3M from a year ago. Dollar volume of $47.5B down 7%.
    • About 7M shares bought back during quarter for $425M, cutting float by 1.6%.
    • Conference call at 5 ET
    • Previously: Discover Financial Services beats by $0.01, misses on revenue (July 22)
    • DFS -0.3% after hours
    | 1 Comment
  • Wed, Jul. 22, 4:08 PM
    • Discover Financial Services (NYSE:DFS): Q2 EPS of $1.33 beats by $0.01.
    • Revenue of $2.18B (+0.5% Y/Y) misses by $40M.
    • Press Release
    | Comment!
  • Wed, Jul. 22, 2:47 PM
    • The enforcement action by the Consumer Financial Protection Bureau is its first against a student loan servicer. The agency accuses Discover (DFS +0.1%) of overstating minimum payments necessary, engaging in illegal debt-collection tactics, and denying borrowers information about how they could receive tax benefits.
    • In paying the $18.5M fine, Discover (DFS +0.1%) - the country's 3rd-largest student-loan lender - neither admitted nor denied the charges.
    • Discover reports Q2 results after the bell.
    • Previously: Citi to pay $700M for deceptive credit card marketing (July 21)
  • Tue, Jul. 21, 5:35 PM
  • Thu, Jul. 16, 4:25 PM
    • Discover Financial Services (NYSE:DFS) declares $0.28/share quarterly dividend, in line with previous.
    • Forward yield 1.89%
    • Payable Aug. 20; for shareholders of record Aug. 6; ex-div Aug. 4.
    | Comment!
  • Tue, Jun. 16, 4:08 PM
    • "The business is not projected to meet our financial expectations due to ongoing challenges to our home loans operating model," says Carlos Minetti, president of consumer banking at Discover (NYSE:DFS).
    • Discover acquired the business - known now as Discover Home Loans - in 2012. Operations at the unit will continue until August, when AmeriSave Mortgage will take over the processing of remaining applications. About 460 employees will be affected. Discover will continue to originate home equity loans through its bank.
    • The company expects to take about a $0.04 per share charge related to the exit.
    • Source: Press release
    | Comment!
  • Mon, Jun. 15, 8:43 AM
    • DFS end of May ending loans of $54.5B vs. $53.9B a month earlier. Average loans of $53.9B vs. $53.6B.
    • Net principal charge-off rate of 2.3% flat from a month earlier. Delinquency rate (over 30 days) of 1.6% also flat.
    • SEC Form 8-K
    | Comment!
  • Mon, Apr. 27, 8:36 AM
    • Beginning this fall Discover (NYSE:DFS) cardholders will be able use Apple Pay to settle up at participating stores, whether through the iPhone, iPad, or Apple Watch.
    • Source: Press Release
    | Comment!
  • Tue, Apr. 21, 4:18 PM
    • Q1 net income of $586M or $1.28 per share vs. $631M and $1.31 one year ago. ROE of 21%.
    • Total loans of $67.6B up 5.9% Y/Y. Credit card loans of $53.5B up 5.1%. Net charge-off rate for credit card loans of 2.40% up eight basis points.
    • Direct Banking pretax income of $881M off 11% Y/Y, thanks to provisions for loan losses of $388M vs.$270M a year ago. Higher provisions are a result of faster growth in loans. Net interest income up 4%. Net interest margin of 9.70% off 18 basis points. Delinquency rate for credit card loans over 30 days past due of 1.64% down eight basis points. Expenses of $93M up 13%, partly thanks to professional fee expense associated with anti-money laundering programs.
    • Payment Services pretax income of $27M off $1M Y/Y.
    • About 6M shares repurchased during quarter for $360M, reducing the float by 1%.
    • Conference call at 5 ET
    • Previously: Discover Financial Services beats by $0.01, revenue in-line (April 21)
    • DFS -0.5% after hours
    | 1 Comment
  • Tue, Apr. 21, 4:07 PM
    • Discover Financial Services (NYSE:DFS): Q1 EPS of $1.28 beats by $0.01.
    • Revenue of $2.17B (+4.3% Y/Y) in-line.
    • Press Release
    | Comment!
  • Mon, Apr. 20, 5:35 PM
  • Thu, Apr. 16, 5:22 PM
    • Discover Financial Services (NYSE:DFS) declares $0.28/share quarterly dividend, 16.7% increase from prior dividend of $0.24.
    • Forward yield 1.88%
    • Payable June 1; for shareholders of record May 15; ex-div May 13.
    • Additionally, board announces $2.2B share repurchase program.
  • Wed, Apr. 15, 10:11 AM
    • Starting today, Discover (NYSE:DFS) cardholders will be able to temporarily turn off their accounts - stopping transactions when cards are lost or stolen.
    • The new feature is for those times when a customer is nearly certain they know where they left their card - whether under a couch cushion or at a restaurant - and just want a temporary freeze until they find it, rather than canceling the account.
    • Source: Marketwatch
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Company Description
Discover Financial Services is a direct banking and payment services company. The Company offers credit card loans, private student loans, personal loans, home equity loans and deposit products.
Sector: Financial
Industry: Credit Services
Country: United States