Stock Analysis Report

Executive Summary

Discover Financial Services, through its subsidiaries, operates as a direct banking and payment services company in the United States.

Snowflake Analysis

Established dividend payer and good value.

Similar Companies

Share Price & News

How has Discover Financial Services's share price performed over time and what events caused price changes?

Latest Share Price and Events

Stable Share Price: 0IBC's share price has been volatile over the past 3 months.

Market Performance

7 Day Return




GB Consumer Finance


GB Market

1 Year Return




GB Consumer Finance


GB Market

Return vs Industry: 0IBC exceeded the UK Consumer Finance industry which returned -70.2% over the past year.

Return vs Market: 0IBC exceeded the UK Market which returned -23% over the past year.

Shareholder returns

7 Day162.1%7.7%10.0%
30 Day11.2%-47.9%-17.6%
90 Day-8.7%-54.1%-27.3%
1 Year8.2%5.8%-68.9%-70.2%-18.9%-23.0%
3 Yearn/a-79.8%-85.5%-12.9%-24.2%
5 Yearn/a-79.3%-86.1%1.6%-21.8%

Price Volatility Vs. Market

How volatile is Discover Financial Services's share price compared to the market and industry in the last 5 years?

Simply Wall St News

No news available


Is Discover Financial Services undervalued compared to its fair value and its price relative to the market?


Undervalued compared to fair value

Share Price vs. Fair Value

Below Fair Value: 0IBC ($77.83) is trading below our estimate of fair value ($251.01)

Significantly Below Fair Value: 0IBC is trading below fair value by more than 20%.

Price To Earnings Ratio

PE vs Industry: 0IBC is good value based on its PE Ratio (4.1x) compared to the Consumer Finance industry average (5.3x).

PE vs Market: 0IBC is good value based on its PE Ratio (4.1x) compared to the UK market (12.4x).

Price to Earnings Growth Ratio

PEG Ratio: 0IBC's earnings are forecast to decline next year, so we can't calculate its PEG ratio.

Price to Book Ratio

PB vs Industry: 0IBC is overvalued based on its PB Ratio (1x) compared to the GB Consumer Finance industry average (0.7x).

Next Steps

Future Growth

How is Discover Financial Services forecast to perform in the next 1 to 3 years based on estimates from 19 analysts?


Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: 0IBC's earnings are forecast to decline over the next 3 years (-4.6% per year).

Earnings vs Market: 0IBC's earnings are forecast to decline over the next 3 years (-4.6% per year).

High Growth Earnings: 0IBC's earnings are forecast to decline over the next 3 years.

Revenue vs Market: 0IBC's revenue (14.9% per year) is forecast to grow faster than the UK market (2.3% per year).

High Growth Revenue: 0IBC's revenue (14.9% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: 0IBC's Return on Equity is forecast to be high in 3 years time (21.8%)

Next Steps

Past Performance

How has Discover Financial Services performed over the past 5 years?


Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: 0IBC has high quality earnings.

Growing Profit Margin: 0IBC's current net profit margins (35.3%) are higher than last year (35%).

Past Earnings Growth Analysis

Earnings Trend: 0IBC's earnings have grown by 5.2% per year over the past 5 years.

Accelerating Growth: 0IBC's earnings growth over the past year (8.1%) exceeds its 5-year average (5.2% per year).

Earnings vs Industry: 0IBC earnings growth over the past year (8.1%) underperformed the Consumer Finance industry 12.7%.

Return on Equity

High ROE: Whilst 0IBC's Return on Equity (24.93%) is high, this metric is skewed due to their high level of debt.

Next Steps

Financial Health

How is Discover Financial Services's financial position? (This company is analysed differently as a bank or financial institution)

Financial Position Analysis

Debt to Equity History and Analysis

Balance Sheet

Inventory Level: 0IBC has a low level of unsold assets or inventory.

Debt Coverage by Assets: 0IBC's debt is covered by short term assets (assets are 3.9x debt).

Financial Institutions Analysis

Asset Level: 0IBC's level of assets compared to its equity is low.

Allowance for Bad Loans: Insufficient data to determine if 0IBC has a sufficient allowance for bad loans.

Low Risk Liabilities: 0IBC reports no customer deposits, loans are made up entirely of externally borrowed funds.

Loan Level: Insufficient data to determine if 0IBC has an acceptable proportion of non-loan assets held.

Low Risk Deposits: 0IBC has advanced significantly more loans than the customer deposits it holds.

Level of Bad Loans: Insufficient data to determine if 0IBC has an appropriate level of bad loans.

Next Steps


What is Discover Financial Services's current dividend yield, its reliability and sustainability?


Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: 0IBC's dividend (4.68%) is higher than the bottom 25% of dividend payers in the UK market (2.69%).

High Dividend: 0IBC's dividend (4.68%) is low compared to the top 25% of dividend payers in the UK market (7.48%).

Stability and Growth of Payments

Stable Dividend: 0IBC's dividends per share have been stable in the past 10 years.

Growing Dividend: 0IBC's dividend payments have increased over the past 10 years.

Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (18.5%), 0IBC's dividend payments are well covered by earnings.

Future Payout to Shareholders

Future Dividend Coverage: 0IBC's dividends in 3 years are forecast to be well covered by earnings (19.9% payout ratio).

Next Steps


How experienced are the management team and are they aligned to shareholders interests?


Average management tenure


Roger Hochschild (54yo)





Mr. Roger Crosby Hochschild serves as the President and Chief Executive Officer for Discover Financial Services Since 1st October, 2018 and serves as Chief Executive Officer and President at Discover Bank  ...

CEO Compensation Analysis

Compensation vs Market: Roger's total compensation ($USD9.25M) is above average for companies of similar size in the UK market ($USD5.40M).

Compensation vs Earnings: Roger's compensation has increased by more than 20% in the past year.

Leadership Team

Roger Hochschild
Former President1.42yrsUS$9.25m0.29% $33.6m
John Greene
Executive VP & CFO0.42yrUS$1.93m0.0089% $1.0m
Wanjiku Walcott
Executive VP0.67yrUS$10.40m0.030% $3.4m
Diane Offereins
Executive VP & President of Payment Services9.83yrsUS$3.88m0.045% $5.3m
Julie Loeger
Executive VP & President of US Cards4.25yrsUS$3.88m0.023% $2.6m
Edward McGrogan
Chief Accounting Officer7.25yrsno data0.0046% $533.2k
Amir Arooni
Executive VP & Chief Information Officerno datano data0.0060% $696.6k
R. Eichfeld
Executive VP and Chief HR & Administrative Officer1.42yrsno data0.0067% $782.4k
Craig Streem
Vice President of Investor Relationsno datano datano data
Leslie Sutton
Vice President of Corporate Communications7yrsno datano data


Average Tenure


Average Age

Experienced Management: 0IBC's management team is considered experienced (2.8 years average tenure).

Board Members

Roger Hochschild
Former President1.42yrsUS$9.25m0.29% $33.6m
Lawrence Weinbach
Independent Chairman1.17yrsUS$504.99kno data
Mary Bush
Independent Director12.67yrsUS$279.99kno data
Jeffrey Aronin
Independent Director12.67yrsUS$264.99k0.022% $2.6m
Mark Thierer
Independent Director6.83yrsUS$264.99kno data
Thomas Maheras
Independent Director11.42yrsUS$274.99k0.017% $2.0m
Gregory Case
Independent Director12.67yrsUS$279.99kno data
Michael Moskow
Independent Director12.42yrsUS$284.99k0.016% $1.9m
Cynthia Glassman
Independent Director11yrsUS$284.99k0.014% $1.6m
Candace Duncan
Independent Director5.83yrsUS$279.99kno data


Average Tenure


Average Age

Experienced Board: 0IBC's board of directors are seasoned and experienced ( 11.2 years average tenure).


Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: 0IBC insiders have bought more shares than they have sold in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Top Shareholders

Company Information

Discover Financial Services's company bio, employee growth, exchange listings and data sources

Key Information

  • Name: Discover Financial Services
  • Ticker: 0IBC
  • Exchange: LSE
  • Founded: 1986
  • Industry: Consumer Finance
  • Sector: Diversified Financials
  • Market Cap: US$11.590b
  • Shares outstanding: 308.34m
  • Website:

Number of Employees


  • Discover Financial Services
  • 2500 Lake Cook Road
  • Riverwoods
  • Illinois
  • 60015
  • United States


TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
DFSNYSE (New York Stock Exchange)YesCommon StockUSUSDJun 2007
DC7DB (Deutsche Boerse AG)YesCommon StockDEEURJun 2007
0IBCLSE (London Stock Exchange)YesCommon StockGBUSDJun 2007
DFS *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNJun 2007
DC7BRSE (Berne Stock Exchange)YesCommon StockCHCHFJun 2007
D1FS34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH 2 REPR 1 SHS UNSPONBRBRLJan 2020


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. The Payment Services segment operates the PULSE network, an automated teller machine, debit, and electronic funds transfer network; Diners Club International, a payments network that issues Diners Club branded charge cards and provides card acceptance services; and Discover Network that processes transactions for Discover-branded credit and debit cards, as well as provides payment transaction processing and settlement services. The company was incorporated in 1986 and is based in Riverwoods, Illinois. 

Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/31 00:43
End of Day Share Price2020/03/30 00:00
Annual Earnings2019/12/31

Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.