DISCOVER FINANCIAL SERVICES (DFS) Fundamental Analysis & Valuation

NYSE:DFS • US2547091080

Current stock price

200.05 USD
-0.43 (-0.21%)
At close:
198.1 USD
-1.95 (-0.97%)
After Hours:

This DFS fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

4

1. DFS Profitability Analysis

1.1 Basic Checks

  • In the past year DFS was profitable.
  • In the past year DFS had a positive cash flow from operations.
  • Each year in the past 5 years DFS has been profitable.
  • Each year in the past 5 years DFS had a positive operating cash flow.
DFS Yearly Net Income VS EBIT VS OCF VS FCFDFS Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2B 4B 6B 8B

1.2 Ratios

  • DFS has a better Return On Assets (3.73%) than 73.08% of its industry peers.
  • DFS has a Return On Equity of 29.08%. This is amongst the best in the industry. DFS outperforms 88.46% of its industry peers.
Industry RankSector Rank
ROA 3.73%
ROE 29.08%
ROIC N/A
ROA(3y)2.69%
ROA(5y)2.78%
ROE(3y)24.58%
ROE(5y)24.76%
ROIC(3y)N/A
ROIC(5y)N/A
DFS Yearly ROA, ROE, ROICDFS Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 2024 10 20 30

1.3 Margins

  • The Profit Margin of DFS (24.89%) is better than 88.46% of its industry peers.
  • In the last couple of years the Profit Margin of DFS has remained more or less at the same level.
  • DFS does not have Operating Margin and Gross Margin available, so we won't be analyzing them here.
Industry RankSector Rank
OM N/A
PM (TTM) 24.89%
GM N/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3Y-17.54%
PM growth 5Y-0.44%
GM growth 3YN/A
GM growth 5YN/A
DFS Yearly Profit, Operating, Gross MarginsDFS Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 2024 10 20 30 40

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ROAROEROICOperating and Profit MarginShow most profitable peers

4

2. DFS Health Analysis

2.1 Basic Checks

  • DFS does not have a ROIC to compare to the WACC, probably because it is not profitable.
  • The number of shares outstanding for DFS has been increased compared to 1 year ago.
  • Compared to 5 years ago, DFS has less shares outstanding
  • DFS has a better debt/assets ratio than last year.
DFS Yearly Shares OutstandingDFS Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 2024 100M 200M 300M
DFS Yearly Total Debt VS Total AssetsDFS Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 2024 50B 100B 150B

2.2 Solvency

  • DFS has a debt to FCF ratio of 1.66. This is a very positive value and a sign of high solvency as it would only need 1.66 years to pay back of all of its debts.
  • DFS's Debt to FCF ratio of 1.66 is amongst the best of the industry. DFS outperforms 86.54% of its industry peers.
  • A Debt/Equity ratio of 0.53 indicates that DFS is somewhat dependend on debt financing.
  • The Debt to Equity ratio of DFS (0.53) is better than 73.08% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.53
Debt/FCF 1.66
Altman-Z N/A
ROIC/WACCN/A
WACC13.23%
DFS Yearly LT Debt VS Equity VS FCFDFS Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 5B 10B 15B 20B

2.3 Liquidity

Industry RankSector Rank
Current Ratio N/A
Quick Ratio N/A
DFS Yearly Current Assets VS Current LiabilitesDFS Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 2024 2B 4B 6B 8B 10B

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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

5

3. DFS Growth Analysis

3.1 Past

  • DFS shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 117.90%, which is quite impressive.
  • DFS shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 11.94% yearly.
  • The Revenue has grown by 36.14% in the past year. This is a very strong growth!
  • DFS shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 9.34% yearly.
EPS 1Y (TTM)117.9%
EPS 3Y-3.52%
EPS 5Y11.94%
EPS Q2Q%286.36%
Revenue 1Y (TTM)36.14%
Revenue growth 3Y14.01%
Revenue growth 5Y9.34%
Sales Q2Q%0.97%

3.2 Future

  • Based on estimates for the next years, DFS will show a decrease in Earnings Per Share. The EPS will decrease by -0.72% on average per year.
  • Based on estimates for the next years, DFS will show a small growth in Revenue. The Revenue will grow by 2.79% on average per year.
EPS Next Y-8.36%
EPS Next 2Y0.39%
EPS Next 3Y4.38%
EPS Next 5Y-0.72%
Revenue Next Year-0.89%
Revenue Next 2Y1.36%
Revenue Next 3Y2.03%
Revenue Next 5Y2.79%

3.3 Evolution

  • When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
  • When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
DFS Yearly Revenue VS EstimatesDFS Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 5B 10B 15B 20B
DFS Yearly EPS VS EstimatesDFS Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 5 10 15

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3

4. DFS Valuation Analysis

4.1 Price/Earnings Ratio

  • The Price/Earnings ratio is 10.47, which indicates a very decent valuation of DFS.
  • Compared to the rest of the industry, the Price/Earnings ratio of DFS is on the same level as its industry peers.
  • When comparing the Price/Earnings ratio of DFS to the average of the S&P500 Index (25.70), we can say DFS is valued rather cheaply.
  • The Price/Forward Earnings ratio is 12.44, which indicates a correct valuation of DFS.
  • The rest of the industry has a similar Price/Forward Earnings ratio as DFS.
  • The average S&P500 Price/Forward Earnings ratio is at 23.84. DFS is valued slightly cheaper when compared to this.
Industry RankSector Rank
PE 10.47
Fwd PE 12.44
DFS Price Earnings VS Forward Price EarningsDFS Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

  • The rest of the industry has a similar Price/Free Cash Flow ratio as DFS.
Industry RankSector Rank
P/FCF 5.96
EV/EBITDA N/A
DFS Per share dataDFS EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 20 40 60 80

4.3 Compensation for Growth

PEG (NY)N/A
PEG (5Y)0.88
EPS Next 2Y0.39%
EPS Next 3Y4.38%

More info and screens

Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

5

5. DFS Dividend Analysis

5.1 Amount

  • With a Yearly Dividend Yield of 1.40%, DFS has a reasonable but not impressive dividend return.
  • Compared to an average industry Dividend Yield of 3.06, DFS has a dividend in line with its industry peers.
  • Compared to the average S&P500 Dividend Yield of 1.89, DFS is paying slightly less dividend.
Industry RankSector Rank
Dividend Yield 1.4%

5.2 History

  • On average, the dividend of DFS grows each year by 11.46%, which is quite nice.
  • DFS has paid a dividend for at least 10 years, which is a reliable track record.
  • DFS has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)11.46%
Div Incr Years14
Div Non Decr Years15
DFS Yearly Dividends per shareDFS Yearly Dividends per shareYearly Dividends per share 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 0.5 1 1.5 2 2.5

5.3 Sustainability

  • 13.98% of the earnings are spent on dividend by DFS. This is a low number and sustainable payout ratio.
DP13.98%
EPS Next 2Y0.39%
EPS Next 3Y4.38%
DFS Yearly Income VS Free CF VS DividendDFS Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 2022 2023 2024 2B 4B 6B 8B
DFS Dividend Payout.DFS Dividend Payout, showing the Payout Ratio.DFS Dividend Payout.PayoutRetained Earnings

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DFS Fundamentals: All Metrics, Ratios and Statistics

DISCOVER FINANCIAL SERVICES

NYSE:DFS (5/16/2025, 8:04:00 PM)

After market: 198.1 -1.95 (-0.97%)

200.05

-0.43 (-0.21%)

Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryConsumer Finance
Earnings (Last)04-23
Earnings (Next)07-15
Inst Owners85.15%
Inst Owner Change-98.76%
Ins Owners0.21%
Ins Owner Change0%
Market Cap50.34B
Revenue(TTM)22.16B
Net Income(TTM)5.51B
Analysts72.38
Price Target204 (1.97%)
Short Float %N/A
Short RatioN/A
Dividend
Industry RankSector Rank
Dividend Yield 1.4%
Yearly Dividend3.08
Dividend Growth(5Y)11.46%
DP13.98%
Div Incr Years14
Div Non Decr Years15
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)40.29%
Min EPS beat(2)24.9%
Max EPS beat(2)55.67%
EPS beat(4)4
Avg EPS beat(4)45.64%
Min EPS beat(4)6.78%
Max EPS beat(4)95.2%
EPS beat(8)4
Avg EPS beat(8)7.01%
EPS beat(12)6
Avg EPS beat(12)3.88%
EPS beat(16)8
Avg EPS beat(16)6.05%
Revenue beat(2)1
Avg Revenue beat(2)2.66%
Min Revenue beat(2)-0.35%
Max Revenue beat(2)5.66%
Revenue beat(4)3
Avg Revenue beat(4)3.57%
Min Revenue beat(4)-0.35%
Max Revenue beat(4)7.61%
Revenue beat(8)6
Avg Revenue beat(8)2.27%
Revenue beat(12)10
Avg Revenue beat(12)1.89%
Revenue beat(16)11
Avg Revenue beat(16)1.79%
PT rev (1m)-0.32%
PT rev (3m)-9.35%
EPS NQ rev (1m)-1.14%
EPS NQ rev (3m)-0.83%
EPS NY rev (1m)6.38%
EPS NY rev (3m)5.61%
Revenue NQ rev (1m)-0.16%
Revenue NQ rev (3m)-0.68%
Revenue NY rev (1m)0.74%
Revenue NY rev (3m)-0.15%
Valuation
Industry RankSector Rank
PE 10.47
Fwd PE 12.44
P/S 2.27
P/FCF 5.96
P/OCF 5.78
P/B 2.65
P/tB 2.69
EV/EBITDA N/A
EPS(TTM)19.11
EY9.55%
EPS(NY)16.09
Fwd EY8.04%
FCF(TTM)33.59
FCFY16.79%
OCF(TTM)34.63
OCFY17.31%
SpS88.06
BVpS75.35
TBVpS74.34
PEG (NY)N/A
PEG (5Y)0.88
Graham NumberN/A
Profitability
Industry RankSector Rank
ROA 3.73%
ROE 29.08%
ROCE N/A
ROIC N/A
ROICexc N/A
ROICexgc N/A
OM N/A
PM (TTM) 24.89%
GM N/A
FCFM 38.14%
ROA(3y)2.69%
ROA(5y)2.78%
ROE(3y)24.58%
ROE(5y)24.76%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexgc growth 3YN/A
ROICexgc growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3YN/A
OM growth 5YN/A
PM growth 3Y-17.54%
PM growth 5Y-0.44%
GM growth 3YN/A
GM growth 5YN/A
F-Score9
Asset Turnover0.15
Health
Industry RankSector Rank
Debt/Equity 0.53
Debt/FCF 1.66
Debt/EBITDA N/A
Cap/Depr 121.4%
Cap/Sales 1.18%
Interest Coverage N/A
Cash Conversion N/A
Profit Quality 153.27%
Current Ratio N/A
Quick Ratio N/A
Altman-Z N/A
F-Score9
WACC13.23%
ROIC/WACCN/A
Cap/Depr(3y)65.85%
Cap/Depr(5y)57.58%
Cap/Sales(3y)1.73%
Cap/Sales(5y)1.83%
Profit Quality(3y)216.26%
Profit Quality(5y)259.05%
High Growth Momentum
Growth
EPS 1Y (TTM)117.9%
EPS 3Y-3.52%
EPS 5Y11.94%
EPS Q2Q%286.36%
EPS Next Y-8.36%
EPS Next 2Y0.39%
EPS Next 3Y4.38%
EPS Next 5Y-0.72%
Revenue 1Y (TTM)36.14%
Revenue growth 3Y14.01%
Revenue growth 5Y9.34%
Sales Q2Q%0.97%
Revenue Next Year-0.89%
Revenue Next 2Y1.36%
Revenue Next 3Y2.03%
Revenue Next 5Y2.79%
EBIT growth 1YN/A
EBIT growth 3YN/A
EBIT growth 5YN/A
EBIT Next YearN/A
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y21.87%
FCF growth 3Y11.88%
FCF growth 5Y6.65%
OCF growth 1Y21.08%
OCF growth 3Y11.86%
OCF growth 5Y6.34%

DISCOVER FINANCIAL SERVICES / DFS Fundamental Analysis FAQ

Can you provide the ChartMill fundamental rating for DISCOVER FINANCIAL SERVICES?

ChartMill assigns a fundamental rating of 4 / 10 to DFS.


What is the valuation status of DISCOVER FINANCIAL SERVICES (DFS) stock?

ChartMill assigns a valuation rating of 3 / 10 to DISCOVER FINANCIAL SERVICES (DFS). This can be considered as Overvalued.


Can you provide the profitability details for DISCOVER FINANCIAL SERVICES?

DISCOVER FINANCIAL SERVICES (DFS) has a profitability rating of 4 / 10.


Can you provide the PE and PB ratios for DFS stock?

The Price/Earnings (PE) ratio for DISCOVER FINANCIAL SERVICES (DFS) is 10.47 and the Price/Book (PB) ratio is 2.65.


Is the dividend of DISCOVER FINANCIAL SERVICES sustainable?

The dividend rating of DISCOVER FINANCIAL SERVICES (DFS) is 5 / 10 and the dividend payout ratio is 13.98%.