Discover Financial Services
Market Cap
US$28.9b
Last Updated
2021/02/28 23:47 UTC
Data Sources
Company Financials +
Executive Summary
Discover Financial Services, through its subsidiaries, operates as a digital banking and payment services company in the United States. More Details
Rewards
Risk Analysis
Snowflake Analysis
Exceptional growth potential established dividend payer.
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: DFS is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 5% a week.
Volatility Over Time: DFS's weekly volatility has decreased from 12% to 5% over the past year.
Market Performance
7 Day Return
0.2%
DFS
-1.8%
US Consumer Finance
-3.6%
US Market
1 Year Return
43.4%
DFS
28.4%
US Consumer Finance
36.5%
US Market
Return vs Industry: DFS exceeded the US Consumer Finance industry which returned 28.4% over the past year.
Return vs Market: DFS exceeded the US Market which returned 36.4% over the past year.
Shareholder returns
| DFS | Industry | Market | |
|---|---|---|---|
| 7 Day | 0.2% | -1.8% | -3.6% |
| 30 Day | 12.6% | 10.6% | 2.7% |
| 90 Day | 23.5% | 17.9% | 7.5% |
| 1 Year | 47.8%43.4% | 31.4%28.4% | 39.5%36.5% |
| 3 Year | 33.4%24.0% | 29.7%22.7% | 53.5%43.6% |
| 5 Year | 117.1%93.8% | 107.4%89.9% | 117.5%93.2% |
Long-Term 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
2 weeks ago | Simply Wall St
Income Investors Should Know That Discover Financial Services (NYSE:DFS) Goes Ex-Dividend Soon2 weeks ago | Simply Wall St
Have Discover Financial Services (NYSE:DFS) Insiders Been Selling Their Stock?1 month ago | Simply Wall St
Did You Participate In Any Of Discover Financial Services' (NYSE:DFS) Fantastic 101% Return ?Valuation
Is Discover Financial Services undervalued compared to its fair value and its price relative to the market?
33.4%
Undervalued compared to fair value
Share Price vs. Fair Value
Below Fair Value: DFS ($94.07) is trading below our estimate of fair value ($141.28)
Significantly Below Fair Value: DFS is trading below fair value by more than 20%.
Price To Earnings Ratio
PE vs Industry: DFS is poor value based on its PE Ratio (26.2x) compared to the US Consumer Finance industry average (12x).
PE vs Market: DFS is poor value based on its PE Ratio (26.2x) compared to the US market (21.3x).
Price to Earnings Growth Ratio
PEG Ratio: DFS is good value based on its PEG Ratio (0.9x)
Price to Book Ratio
PB vs Industry: DFS is overvalued based on its PB Ratio (2.9x) compared to the US Consumer Finance industry average (1.3x).
Next Steps
Future Growth
How is Discover Financial Services forecast to perform in the next 1 to 3 years based on estimates from 18 analysts?
30.6%
Forecasted annual earnings growth
Earnings and Revenue Growth Forecasts
Analyst Future Growth Forecasts
Earnings vs Savings Rate: DFS's forecast earnings growth (30.6% per year) is above the savings rate (2%).
Earnings vs Market: DFS's earnings (30.6% per year) are forecast to grow faster than the US market (20.1% per year).
High Growth Earnings: earnings are expected to grow significantly over the next 3 years.
Revenue vs Market: DFS's revenue (24.5% per year) is forecast to grow faster than the US market (10.4% per year).
High Growth Revenue: DFS's revenue (24.5% per year) is forecast to grow faster than 20% per year.
Earnings per Share Growth Forecasts
Future Return on Equity
Future ROE: DFS's Return on Equity is forecast to be high in 3 years time (26.7%)
Next Steps
Past Performance
How has Discover Financial Services performed over the past 5 years?
-5.1%
Historical annual earnings growth
Earnings and Revenue History
Quality Earnings: DFS has high quality earnings.
Growing Profit Margin: DFS's current net profit margins (18.5%) are lower than last year (35.3%).
Past Earnings Growth Analysis
Earnings Trend: DFS's earnings have declined by 5.1% per year over the past 5 years.
Accelerating Growth: DFS's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.
Earnings vs Industry: DFS had negative earnings growth (-61.9%) over the past year, making it difficult to compare to the Consumer Finance industry average (-28.4%).
Return on Equity
High ROE: DFS's Return on Equity (10.5%) is considered low.
Next Steps
Financial Health
How is Discover Financial Services's financial position?
Financial Position Analysis
Short Term Liabilities: DFS's short term assets ($96.8B) exceed its short term liabilities ($84.7B).
Long Term Liabilities: DFS's short term assets ($96.8B) exceed its long term liabilities ($17.3B).
Debt to Equity History and Analysis
Debt Level: DFS's debt to equity ratio (195.2%) is considered high.
Reducing Debt: DFS's debt to equity ratio has reduced from 218.9% to 195.2% over the past 5 years.
Debt Coverage: DFS's debt is well covered by operating cash flow (29.2%).
Interest Coverage: Insufficient data to determine if DFS's interest payments on its debt are well covered by EBIT.
Balance Sheet
Next Steps
Dividend
What is Discover Financial Services's current dividend yield, its reliability and sustainability?
1.87%
Current Dividend Yield
Dividend Yield vs Market
Notable Dividend: DFS's dividend (1.87%) is higher than the bottom 25% of dividend payers in the US market (1.34%).
High Dividend: DFS's dividend (1.87%) is low compared to the top 25% of dividend payers in the US market (3.77%).
Stability and Growth of Payments
Stable Dividend: DFS's dividends per share have been stable in the past 10 years.
Growing Dividend: DFS's dividend payments have increased over the past 10 years.
Current Payout to Shareholders
Dividend Coverage: With its reasonably low payout ratio (48.9%), DFS's dividend payments are well covered by earnings.
Future Payout to Shareholders
Future Dividend Coverage: DFS's dividends in 3 years are forecast to be well covered by earnings (17.9% payout ratio).
Next Steps
Management
How experienced are the management team and are they aligned to shareholders interests?
2.4yrs
Average management tenure
CEO
Roger Hochschild (55 yo)
2.33yrs
Tenure
US$9,250,436
Compensation
Mr. Roger Crosby Hochschild serves Chief Executive Officer for Discover Financial Services since October 1, 2018 has been its President since March 2004 and also serves as its Member of Board of Directors ...
CEO Compensation Analysis
Compensation vs Market: Roger's total compensation ($USD9.25M) is about average for companies of similar size in the US market ($USD10.55M).
Compensation vs Earnings: Roger's compensation has increased by more than 20% whilst company earnings have fallen more than 20% in the past year.
Leadership Team
| Name | Position | Tenure | Compensation | Ownership |
|---|---|---|---|---|
| CEO, President & Director | 2.33yrs | US$9.25m | 0.28% $ 80.7m | |
| Executive VP & CFO | 1.42yrs | US$1.93m | 0.011% $ 3.3m | |
| Executive VP | 1.58yrs | US$10.40m | 0.029% $ 8.2m | |
| Executive VP & President of Payment Services | 10.83yrs | US$3.88m | 0.042% $ 12.1m | |
| Chief Accounting Officer | 0.25yr | no data | 0.0017% $ 499.1k | |
| Executive VP & Chief Information Officer | 0.92yr | no data | 0.0083% $ 2.4m | |
| Executive VP and Chief HR & Administrative Officer | 2.42yrs | no data | 0.013% $ 3.6m | |
| Vice President of Investor Relations | no data | no data | no data | |
| Vice President of Corporate Communications | 8yrs | no data | no data | |
| Executive VP & President of Consumer Banking | 7yrs | US$3.72m | 0.051% $ 14.8m | |
| Executive VP & Chief Risk Officer | 4.75yrs | no data | 0.021% $ 5.9m | |
| Executive VP & President of US Cards | 3.67yrs | no data | 0.012% $ 3.5m |
2.4yrs
Average Tenure
54.5yo
Average Age
Experienced Management: DFS's management team is considered experienced (2.4 years average tenure).
Board Members
| Name | Position | Tenure | Compensation | Ownership |
|---|---|---|---|---|
| CEO, President & Director | 2.33yrs | US$9.25m | 0.28% $ 80.7m | |
| Independent Director | 13.67yrs | US$279.99k | 0.018% $ 5.3m | |
| Independent Director | 5.08yrs | US$274.99k | 0.0031% $ 888.6k | |
| Independent Director | 13.67yrs | US$264.99k | 0.023% $ 6.8m | |
| Independent Director | 7.83yrs | US$264.99k | 0.0065% $ 1.9m | |
| Independent Chairman | 0.75yr | US$274.99k | 0.019% $ 5.3m | |
| Independent Director | 13.67yrs | US$279.99k | 0.023% $ 6.8m | |
| Independent Director | 13.42yrs | US$284.99k | 0.0016% $ 467.4k | |
| Independent Director | 12yrs | US$284.99k | 0.015% $ 4.3m | |
| Independent Director | 6.75yrs | US$279.99k | 0.0055% $ 1.6m | |
| Independent Director | 1.58yrs | US$187.48k | 0.0018% $ 504.9k | |
| Director | no data | no data | 0.00013% $ 37.5k |
7.8yrs
Average Tenure
57yo
Average Age
Experienced Board: DFS's board of directors are considered experienced (7.8 years average tenure).
Ownership
Who are the major shareholders and have insiders been buying or selling?
Insider Trading Volume
Insider Buying: DFS insiders have only sold shares 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: DFS
- Exchange: NYSE
- Founded: 1960
- Industry: Consumer Finance
- Sector: Diversified Financials
- Market Cap: US$28.850b
- Shares outstanding: 306.69m
- Website: https://www.discover.com
Number of Employees
Location
- Discover Financial Services
- 2500 Lake Cook Road
- Riverwoods
- Illinois
- 60015
- United States
Listings
| Ticker | Exchange | Primary Security | Security Type | Country | Currency | Listed on |
|---|---|---|---|---|---|---|
| DFS | NYSE (New York Stock Exchange) | Yes | Common Stock | US | USD | Jun 2007 |
| DC7 | DB (Deutsche Boerse AG) | Yes | Common Stock | DE | EUR | Jun 2007 |
| 0IBC | LSE (London Stock Exchange) | Yes | Common Stock | GB | USD | Jun 2007 |
| DFS * | BMV (Bolsa Mexicana de Valores) | Yes | Common Stock | MX | MXN | Jun 2007 |
| A19RND | DB (Deutsche Boerse AG) | 5.5%-FRN SUB PERP USD 'C' | DE | USD | Oct 2017 | |
| D1FS34 | BOVESPA (Bolsa de Valores de Sao Paulo) | BDR EACH 2 REPR 1 SHS UNSPON | BR | BRL | Jan 2020 |
Biography
Discover Financial Services, through its subsidiaries, operates as a digital banking and payment services company in the United States. It operates in two segments, Digital Banking and Payment Services. Th...
Company Analysis and Financial Data Status
| Data | Last Updated (UTC time) |
|---|---|
| Company Analysis | 2021/02/28 23:47 |
| End of Day Share Price | 2021/02/26 00:00 |
| Earnings | 2020/12/31 |
| Annual Earnings | 2020/12/31 |
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.