Updated with market close information. NEW YORK ( TheStreet) -- With credit card master trust data indicating that card loan quality is trending better this year than he expected, KBW analyst Sanjay Sakhrani on Thursday reiterated his "Buy" ratings for Discover Financial Services ( DFS), Capital One ( COF) and the credit card gold standard, American Express ( AXP). Sakhrani said that that based on January reports by the major credit card loan securitizers, "average industry charge-offs still remain in favorable territory as they continue to stay below normalized levels of roughly 5%." The analyst added that "delinquency trends continued to be constructive, with the card issuers posting sequential movements that were in-line to better than typical seasonal trends seen in January," although loan balances declined during the month, "as expected." During January, the average charge-off rate among the seven issuers detailed in KBW's report declined to 4.25%, improving from 4.36% in December and 6.69% in January 2011. Major credit card players seeing continued improvement included American Express, with the lowest charge-off rate of 2.25% in January, improving from 2.28% in December, while World Financial Network -- a subsidiary of Alliance Data Systems ( ADS) -- had the highest charge-off rate of 6.07%, improving from 6.39% in December. Bank of America ( BAC), saw its January credit card charge-off rate decline to 5.63% from 6.05% in December. Discover's charge-off rate declined to 2.75% in January, from 3.15% the previous month. Major card securitizers seeing increased January charge-off rates included Capital One, with a 3.54% charge-off rate, compared to 3.43% in December; JPMorgan Chases's ( JPM) Chase Issuance Trust, with a charge-off rate of 4.25%, increasing from 4.11% in December; and Citigroup ( C) subsidiary Citibank, with a charge-off rate of 5.27%, increasing from 5.11% the previous month. Discover's shares have returned 23% year-to-date, through Thursday's close at $29.58.The shares trade for nine times the consensus fiscal 2012 earnings estimate of $3.36 a share, among analysts polled by Thomson Reuters. The company reported a return on average equity (ROE) of 30% for its fiscal 2011, ended Nov. 30. Sakrhani reiterated his "Outperform" rating for Discover, with a $32 price target, saying "sequential improvements in both charge-offs and delinquencies outperformed seasonal trends, with charge-offs improving by double the amount typically seen in January and delinquencies actually modestly declining relative to the typical 15-20 bps increase seen during the month. Sakrhrani is ahead of the consensus, estimating that that Discover will earn 43.48 a share during fiscal 2012, although his $3.10 EPS estimate for fiscal 2013 is behind the consensus estimate of $3.37. Interested in more on Discover Financial Services? See TheStreet Ratings' report card for this stock.