Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link. Trade-Ideas LLC identified Discover Financial Services ( DFS) as a pre-market leader candidate. In addition to specific proprietary factors, Trade-Ideas identified Discover Financial Services as such a stock due to the following factors:
- DFS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $172.5 million.
- DFS traded 11,383 shares today in the pre-market hours as of 9:17 AM.
- DFS is up 3.6% today from yesterday's close.
EXCLUSIVE OFFER: Get the inside scoop on opportunities in DFS with the Ticky from Trade-Ideas. See the FREE profile for DFS NOW at Trade-Ideas More details on DFS: Discover Financial Services, a bank holding company, provides direct banking and payment services in the United States. It operates in two segments, Direct Banking and Payment Services. The stock currently has a dividend yield of 1.5%. DFS has a PE ratio of 11.9. Currently there are 12 analysts that rate Discover Financial Services a buy, no analysts rate it a sell, and 7 rate it a hold. The average volume for Discover Financial Services has been 2.8 million shares per day over the past 30 days. Discover Financial Services has a market cap of $25.4 billion and is part of the financial sector and financial services industry. The stock has a beta of 0.73 and a short float of 0.9% with 1.38 days to cover. Shares are down 4.1% year-to-date as of the close of trading on Wednesday. STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more. TheStreetRatings.com Analysis: TheStreet Quant Ratings rates Discover Financial Services as a buy. The company's strengths can be seen in multiple areas, such as its solid stock price performance, revenue growth, expanding profit margins and largely solid financial position with reasonable debt levels by most measures. We feel these strengths outweigh the fact that the company has had sub par growth in net income. Highlights from the ratings report include:
- Compared to its closing price of one year ago, DFS's share price has jumped by 38.69%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, DFS should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- Despite its growing revenue, the company underperformed as compared with the industry average of 4.5%. Since the same quarter one year prior, revenues slightly increased by 2.2%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
- DISCOVER FINANCIAL SVCS INC reported flat earnings per share in the most recent quarter. This company has reported somewhat volatile earnings recently. But, we feel it is poised for EPS growth in the coming year. During the past fiscal year, DISCOVER FINANCIAL SVCS INC increased its bottom line by earning $4.46 versus $4.06 in the prior year. This year, the market expects an improvement in earnings ($4.92 versus $4.46).
- 46.24% is the gross profit margin for DISCOVER FINANCIAL SVCS INC which we consider to be strong. Regardless of DFS's high profit margin, it has managed to decrease from the same period last year. Despite the mixed results of the gross profit margin, DFS's net profit margin of 25.34% significantly outperformed against the industry.
- Despite the current debt-to-equity ratio of 1.77, it is still below the industry average, suggesting that this level of debt is acceptable within the Consumer Finance industry.
- You can view the full Discover Financial Services Ratings Report.
STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.