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Discover Financial's Strong Capital Base to Boost Growth
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On Jul 15, 2016, we issued an updated research report on Discover Financial Services (DFS - Free Report) .
In the recently reported quarter, the company’s earnings per share of $1.47 surpassed the Zacks Consensus Estimate by 3.5%. The second-quarter 2016 earnings also improved 10.5% year over year. Higher revenues and lower expenses drove the upside. Also, the top line inched up 1.9% year over year and beat the Zacks Consensus Estimate.
Since its inception, Discover Financial has grown to be one of the biggest direct banking and payment services companies in the U.S. It continues to launch new products tailored to suit specific customer needs in order to attract new customers.
The company is expected to witness an increase in card sales volume owing to improved consumer spending and wallet share, credit quality trends and new card accounts. A number of alliances and partnerships forged over the years have also grown the company’s card acceptance worldwide.
Discover Financial has implemented several capital-boosting initiatives, including equity and debt offerings, which have helped it achieve a strong capital base. Recently, the company also managed to fulfill the terms of the Federal Reserve's Comprehensive Capital Analysis and Review process. It received an approval from the Fed with respect to its proposed capital actions for the four quarters ending Jun 30, 2017. As a result, it can now repurchase almost $2 billion of its stock over the next 12 months. Last month, the company hiked its quarterly dividend by 7%.
Other companies like Capital One Financial Corporation (COF - Free Report) , American Express Company (AXP - Free Report) , Ally Financial Inc. (ALLY - Free Report) have also been subjected to Comprehensive Capital Analysis and Review (CCAR) review.
Nevertheless, intense competition from industry giants has been limiting Discover Financial’s business opportunities. Expenses associated with several marketing and business development activities to survive in the tough market conditions remains an area of concern. Nonetheless, we note that the company was able to exercise some control over it in the second quarter. Also, the weak performance of the company’s Payments Service segment remains a concern.
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Discover Financial's Strong Capital Base to Boost Growth
On Jul 15, 2016, we issued an updated research report on Discover Financial Services (DFS - Free Report) .
In the recently reported quarter, the company’s earnings per share of $1.47 surpassed the Zacks Consensus Estimate by 3.5%. The second-quarter 2016 earnings also improved 10.5% year over year. Higher revenues and lower expenses drove the upside. Also, the top line inched up 1.9% year over year and beat the Zacks Consensus Estimate.
Since its inception, Discover Financial has grown to be one of the biggest direct banking and payment services companies in the U.S. It continues to launch new products tailored to suit specific customer needs in order to attract new customers.
The company is expected to witness an increase in card sales volume owing to improved consumer spending and wallet share, credit quality trends and new card accounts. A number of alliances and partnerships forged over the years have also grown the company’s card acceptance worldwide.
Discover Financial has implemented several capital-boosting initiatives, including equity and debt offerings, which have helped it achieve a strong capital base. Recently, the company also managed to fulfill the terms of the Federal Reserve's Comprehensive Capital Analysis and Review process. It received an approval from the Fed with respect to its proposed capital actions for the four quarters ending Jun 30, 2017. As a result, it can now repurchase almost $2 billion of its stock over the next 12 months. Last month, the company hiked its quarterly dividend by 7%.
Other companies like Capital One Financial Corporation (COF - Free Report) , American Express Company (AXP - Free Report) , Ally Financial Inc. (ALLY - Free Report) have also been subjected to Comprehensive Capital Analysis and Review (CCAR) review.
Nevertheless, intense competition from industry giants has been limiting Discover Financial’s business opportunities. Expenses associated with several marketing and business development activities to survive in the tough market conditions remains an area of concern. Nonetheless, we note that the company was able to exercise some control over it in the second quarter. Also, the weak performance of the company’s Payments Service segment remains a concern.
DISCOVER FIN SV Price and Consensus
DISCOVER FIN SV Price and Consensus | DISCOVER FIN SV Quote
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