- Discover Financial’s Q2 loans amounted to $127.6 billion, matching estimates closely.
- Loans increased by 0.8% quarter-over-quarter (q/q), against an estimate of $127.71 billion.
- Net interest margin increased to 11.2% from 11% (q/q), beating the estimate of 10.7%.
- Earnings per share (EPS) saw significant growth to $6.06 from $3.54 year-over-year (y/y).
- Revenue net of interest expense rose to $4.54 billion, a 17% increase y/y, exceeding the estimate of $4.17 billion.
- Provision for credit losses significantly decreased by 43% y/y to $739 million, well below the estimate of $1.6 billion.
- Charge-offs were at 4.83%, up from 3.22% y/y but still below the estimate of 4.96%.
- Analyst Recommendations: 6 buys, 14 holds, 0 sells.
A look at Discover Financial Services Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 3 | |
| Dividend | 3 | |
| Growth | 3 | |
| Resilience | 3 | |
| Momentum | 4 | |
| OVERALL SMART SCORE | 3.2 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Discover Financial Services is positioned well for the long term, boasting a solid overall outlook based on Smartkarma Smart Scores. The company scores a consistent 3 across key factors such as Value, Dividend, Growth, and Resilience, indicating a stable performance in these areas. Furthermore, Discover Financial Services shows promising Momentum with a score of 4, suggesting positive market traction. Combining these scores, Discover Financial Services appears to be a robust player in the financial sector.
As a credit card issuer and electronic payment services company, Discover Financial Services offers a range of financial products including credit cards, student and personal loans, and savings products like certificates of deposit. Additionally, the company operates an extensive ATM/debit network across the nation. With balanced Smart Scores across important metrics, Discover Financial Services seems well-positioned to maintain its competitive edge and achieve sustained growth in the long run.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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