Discover Financial Services

DFS

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Market Cap$50.34B

Close$

Compare to Similar Companies

	P/E Ratio	Dividends	Return on Equity	Price-to-Sales	Debt-to-Equity
Discover Financial Services	21	-	20%	3	-

Earnings Call Q1 2025

April 24, 2025 - AI Summary

Merger Approval with Capital One: Discover Financial Services received regulatory approval from the Federal Reserve Board and the Office of the Controller of the Currency for its merger with Capital One, expected to close on May 18, 2025. This merger is anticipated to create increased competition in payment networks and provide broader product offerings for customers, while also benefiting communities and shareholders.

Strong Financial Performance: The first quarter of 2025 saw net income rise to $1.1 billion, a 30% increase year-over-year (YOY), driven by a healthy net interest margin and positive credit performance. Earnings per share also increased by 31%, indicating robust operational efficiency.

Net Interest Margin Expansion: Discover's net interest margin was reported at 12.18%, up 115 basis points YOY and 22 basis points sequentially. This improvement is attributed to factors including a student loan sale, changes in the card promotional balance mix, and reduced consumer deposit pricing, showcasing effective management of interest income.

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$158.36

Current Fair Value

20.8% downside

Overvalued by 20.8% based on the discounted cash flow analysis.

Share Statistics

Market cap	$50.34 Billion
Enterprise Value	$38.48 Billion
Dividend Yield	$2.80 (-)
Earnings per Share	$17.71
Beta	1.15
Outstanding Shares	252,000,000

Return

Return on Equity	19.97%
Return on Assets	2.56%
Return on Invested Capital	1.83%

Valuation & Multiples

P/E Ratio	21.05
PEG	-21.05
Price to Sales	3.03
Price to Book Ratio	2.67
Enterprise Value to Revenue	2.31
Enterprise Value to EBIT	14.25
Enterprise Value to Net Income	10
Total Debt to Enterprise	0
Debt to Equity	0

Revenue Sources

No data

Insider Trades

Institutional Sentiment (Put/Call)

No data available for the latest quarter.

Institutional Ownership

No data available for the latest quarter.

ESG Score

No data

About Discover Financial Services

CEO: Roger Hochschild

Relevant Senate Committees

Joint Committee on Taxation

Provides essential analysis and revenue estimates for all tax legislation, directly influencing corporate tax structures and financial markets, which profoundly impacts Discover's profitability.

Finance

The most powerful economic committee, controlling taxation and entitlement spending, which directly impacts corporate profitability, consumer liquidity, and the overall financial environment for credit card issuers.

Judiciary

Oversees antitrust laws and the DOJ, which can profoundly impact competition within the credit card and payment network industry, including potential investigations into market practices or M&A.

Banking, Housing, and Urban Affairs

Directly regulates the entire financial system, including the Federal Reserve, SEC, and consumer lending laws, which are paramount for a credit card issuer like Discover.

Commerce, Science, and Transportation

Has jurisdiction over the FTC, a key regulator for consumer protection, advertising practices, data privacy, and anti-competitive behavior in the financial services sector, directly impacting credit card issuers.