Today, Discover Financial Services (DFS) Upgrade to Buy by The Zacks Investment Research

Today, Discover Financial Services (DFS) Upgrade to Buy by The Zacks Investment Research

Discover Financial Services (NYSE:DFS) was upgraded by Zacks Investment Research from a “hold” rating to a “buy” rating in a report issued on Friday. The firm presently has a $76.00 price target on the financial services provider’s stock. Zacks Investment Research’s target price suggests a potential upside of 11.31% from the stock’s current price.

According to Zacks, “Discover Financial shares have outperformed Zacks categorized Consumer Loan industry over the last three months. 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.”

Other equities research analysts have also issued research reports about the stock. Jefferies Group boosted their price objective on shares of Discover Financial Services from $66.00 to $70.00 and gave the stock a “buy” rating in a research note on Thursday, September 1st. Credit Suisse Group AG reissued a “buy” rating on shares of Discover Financial Services in a research note on Tuesday, August 23rd. Deutsche Bank AG reissued a “buy” rating and set a $63.00 price objective on shares of Discover Financial Services in a research note on Thursday, August 18th. Barclays PLC lowered shares of Discover Financial Services from an “overweight” rating to an “equal weight” rating in a research note on Wednesday, September 7th. Finally, JMP Securities boosted their price objective on shares of Discover Financial Services from $63.00 to $71.00 and gave the stock a “market outperform” rating in a research note on Tuesday. One equities research analyst has rated the stock with a sell rating, six have given a hold rating, seventeen have issued a buy rating and three have assigned a strong buy rating to the stock. The company currently has a consensus rating of “Buy” and an average target price of $64.54.

Shares of Discover Financial Services (NYSE:DFS) opened at 68.28 on Friday. The stock has a market cap of $26.93 billion, a price-to-earnings ratio of 12.43 and a beta of 1.39. The stock’s 50 day moving average is $58.93 and its 200 day moving average is $57.02. Discover Financial Services has a 52 week low of $42.86 and a 52 week high of $68.34.

The business also recently announced a quarterly dividend, which was paid on Thursday, November 17th. Investors of record on Thursday, November 3rd were given a dividend of $0.30 per share. The ex-dividend date of this dividend was Tuesday, November 1st. This represents a $1.20 dividend on an annualized basis and a dividend yield of 1.76%. Discover Financial Services’s dividend payout ratio is 21.74%.

In other Discover Financial Services news, EVP Kathryn Mcnamara Corley sold 15,000 shares of the stock in a transaction on Thursday, November 3rd. The shares were sold at an average price of $56.30, for a total transaction of $844,500.00. Following the completion of the transaction, the executive vice president now owns 156,476 shares in the company, valued at $8,809,598.80. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available through the SEC website. Also, CFO R. Mark Graf sold 25,032 shares of the 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 transaction, the chief financial officer now owns 116,052 shares of the company’s stock, valued at approximately $6,589,432.56. The disclosure for this sale can be found here. Corporate insiders own 1.07% of the company’s stock.

Institutional investors have recently added to or reduced their stakes in the stock. Vanguard Group Inc. raised its position in Discover Financial Services by 1.6% in the second quarter. Vanguard Group Inc. now owns 25,018,247 shares of the financial services provider’s stock valued at $1,340,727,000 after buying an additional 394,393 shares during the period. Boston Partners raised its position in Discover Financial Services by 11.9% in the second quarter. Boston Partners now owns 16,727,596 shares of the financial services provider’s stock valued at $896,432,000 after buying an additional 1,784,386 shares during the period. BlackRock Institutional Trust Company N.A. raised its position in Discover Financial Services by 0.4% in the third quarter. BlackRock Institutional Trust Company N.A. now owns 10,857,013 shares of the financial services provider’s stock valued at $613,964,000 after buying an additional 47,257 shares during the period. LSV Asset Management raised its position in Discover Financial Services by 1.3% in the third quarter. LSV Asset Management now owns 7,015,656 shares of the financial services provider’s stock valued at $396,735,000 after buying an additional 90,549 shares during the period. Finally, BlackRock Advisors LLC raised its position in Discover Financial Services by 10.4% in the third quarter. BlackRock Advisors LLC now owns 5,502,924 shares of the financial services provider’s stock valued at $311,190,000 after buying an additional 516,575 shares during the period. Institutional investors and hedge funds own 85.10% of the company’s stock.

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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