DFS Fundamental Analysis - DISCOVER FINANCIAL SERVICES

Fundamental Rating

Overall DFS gets a fundamental rating of 4 out of 10. We evaluated DFS against 55 industry peers in the Consumer Finance industry. Both the profitability and the financial health of DFS get a neutral evaluation. Nothing too spectacular is happening here. While showing a medium growth rate, DFS is valued expensive at the moment.

Quickly go to:

1. Profitability

1.1 Basic Checks

DFS had positive earnings in the past year.

DFS had a positive operating cash flow in the past year.

In the past 5 years DFS has always been profitable.

Each year in the past 5 years DFS had a positive operating cash flow.

1.2 Ratios

With a decent Return On Assets value of 3.73%, DFS is doing good in the industry, outperforming 73.08% of the companies in the same industry.

With an excellent Return On Equity value of 29.08%, DFS belongs to the best of the industry, outperforming 88.46% of the companies in the same industry.

		Industry Rank	Sector 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

1.3 Margins

DFS's Profit Margin of 24.89% is amongst the best of the industry. DFS outperforms 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.

The Operating Margin and Gross Margin are not available for DFS so they could not be analyzed.

		Industry Rank	Sector 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

More info and screens

ROA

ROE

ROIC

Operating and Profit Margin

Show most profitable peers

2. Health

2.1 Basic Checks

DFS does not have a ROIC to compare to the WACC, probably because it is not profitable.

DFS has more shares outstanding than it did 1 year ago.

DFS has less shares outstanding than it did 5 years ago.

The debt/assets ratio for DFS has been reduced compared to a year ago.

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.

DFS has a Debt/Equity ratio of 0.53. This is a neutral value indicating DFS is somewhat dependend on debt financing.

DFS's Debt to Equity ratio of 0.53 is fine compared to the rest of the industry. DFS outperforms 73.08% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	0.53
Debt/FCF	1.66
Altman-Z	N/A

ROIC/WACCN/A

WACC13.23%

2.3 Liquidity

		Industry Rank	Sector Rank
Current Ratio	N/A
Quick Ratio	N/A

More info and screens

WACC

Debt/Equity

How to determine the health of a company

Altman-Z score

Show peers with great health

3. Growth

3.1 Past

The Earnings Per Share has grown by an impressive 117.90% over the past year.

Measured over the past years, DFS shows a quite strong growth in Earnings Per Share. The EPS has been growing by 11.94% on average per year.

DFS shows a strong growth in Revenue. In the last year, the Revenue has grown by 36.14%.

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.

The Revenue is expected to grow by 2.79% on average over the next years.

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

The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.

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.

More info and screens

Find the best growth stocks

Show best growing peers

4. Valuation

4.1 Price/Earnings Ratio

DFS is valuated reasonably with a Price/Earnings ratio of 10.47.

DFS's Price/Earnings is on the same level as the industry average.

When comparing the Price/Earnings ratio of DFS to the average of the S&P500 Index (27.55), we can say DFS is valued rather cheaply.

Based on the Price/Forward Earnings ratio of 12.44, the valuation of DFS can be described as correct.

The rest of the industry has a similar Price/Forward Earnings ratio as DFS.

DFS's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 23.04.

		Industry Rank	Sector Rank
PE	10.47
Fwd PE	12.44

4.2 Price Multiples

DFS's Price/Free Cash Flow is on the same level as the industry average.

		Industry Rank	Sector Rank
P/FCF	5.96
EV/EBITDA	N/A

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

Show best valued peers

5. Dividend

5.1 Amount

DFS has a Yearly Dividend Yield of 1.40%.

DFS's Dividend Yield is comparable with the industry average which is at 4.51.

Compared to an average S&P500 Dividend Yield of 2.43, DFS's dividend is way lower than the S&P500 average.

		Industry Rank	Sector 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 its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.

Dividend Growth(5Y)11.46%

Div Incr Years14

Div Non Decr Years15

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%

More info and screens

Find the best dividend stocks

Show peers with best dividend

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 2025-04-23/amc

Earnings (Next)07-15 2025-07-15/amc

Inst Owners85.15%

Inst Owner Change-0.71%

Ins Owners0.21%

Ins Owner Change-16.74%

Market Cap50.34B

Analysts72.38

Price Target204 (1.97%)

Short Float %N/A

Short RatioN/A

Dividend

		Industry Rank	Sector Rank
Dividend Yield	1.4%

Yearly Dividend3.08

Dividend Growth(5Y)11.46%

DP13.98%

Div Incr Years14

Div Non Decr Years15

Ex-Date05-23 2025-05-23 (0.7)

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 Rank	Sector 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

Profitability

		Industry Rank	Sector 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

ROICexcg growth 3YN/A

ROICexcg 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 Rank	Sector 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) Stock Fundamental Analysis

1. Profitability

1.1 Basic Checks

1.2 Ratios

1.3 Margins

More info and screens

2. Health

2.1 Basic Checks

2.2 Solvency

2.3 Liquidity

More info and screens

3. Growth

3.1 Past

3.2 Future

3.3 Evolution

More info and screens

4. Valuation

4.1 Price/Earnings Ratio

4.2 Price Multiples

4.3 Compensation for Growth

More info and screens

5. Dividend

5.1 Amount

5.2 History

5.3 Sustainability

More info and screens