Discover Financial Services (NYSE:DFS) was downgraded by Zacks Investment Research from a “hold” rating to a “sell” rating in a research report issued on Monday.

According to Zacks, “Year to date, the shares of Discover Financial have underperformed the industry. The company has been incurring considerable expenses from past many quarters. in order to compete with other credit card issuers, attract and retain customers, and increase card usage. The rising expenses have been severely weighing on the company’s margins. Its Payments Service segment has been a drag over the past few years despite management’s several corrective efforts. This segment affects the company’s overall underwriting results adversely. Discover Financial will release its third quarter results on Oct 24, 2017 after the market closes.”

A number of other equities research analysts have also issued reports on the stock. Morgan Stanley cut their target price on shares of Discover Financial Services from $71.00 to $70.00 and set an “overweight” rating on the stock in a research note on Friday, September 8th. William Blair restated an “outperform” rating on shares of Discover Financial Services in a research note on Tuesday, July 18th. BidaskClub lowered shares of Discover Financial Services from a “hold” rating to a “sell” rating in a research note on Monday, June 26th. Wells Fargo & Company started coverage on shares of Discover Financial Services in a research note on Tuesday, October 10th. They issued a “market perform” rating and a $69.00 target price on the stock. Finally, ValuEngine lowered shares of Discover Financial Services from a “buy” rating to a “hold” rating in a research note on Monday, September 11th. Three investment analysts have rated the stock with a sell rating, eight have issued a hold rating and sixteen have assigned a buy rating to the company. The stock currently has a consensus rating of “Hold” and a consensus target price of $73.58.

Discover Financial Services (DFS) traded up 0.41% during mid-day trading on Monday, reaching $66.84. The company’s stock had a trading volume of 2,552,899 shares. The stock’s 50 day moving average price is $62.45 and its 200 day moving average price is $61.67. Discover Financial Services has a 1-year low of $55.01 and a 1-year high of $74.33. The stock has a market capitalization of $24.89 billion, a P/E ratio of 11.53 and a beta of 1.47.

Discover Financial Services (NYSE:DFS) last issued its earnings results on Wednesday, July 26th. The financial services provider reported $1.40 earnings per share (EPS) for the quarter, missing analysts’ consensus estimates of $1.45 by ($0.05). The company had revenue of $2.42 billion during the quarter, compared to analyst estimates of $2.40 billion. Discover Financial Services had a net margin of 20.91% and a return on equity of 21.28%. The business’s revenue for the quarter was up 9.2% compared to the same quarter last year. During the same quarter last year, the company posted $1.47 EPS. Analysts expect that Discover Financial Services will post $5.92 EPS for the current fiscal year.

Discover Financial Services declared that its board has initiated a stock repurchase plan on Wednesday, June 28th that authorizes the company to repurchase $2.23 billion in shares. This repurchase authorization authorizes the financial services provider to repurchase up to 9.5% of its stock through open market purchases. Stock repurchase plans are usually a sign that the company’s board of directors believes its stock is undervalued.

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In other news, EVP Carlos Minetti sold 8,000 shares of the stock in a transaction that occurred on Tuesday, August 1st. The shares were sold at an average price of $61.29, for a total value of $490,320.00. Following the completion of the transaction, the executive vice president now directly owns 197,149 shares in the company, valued at $12,083,262.21. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available at this hyperlink. Also, SVP Edward W. Mcgrogan sold 1,228 shares of the stock in a transaction that occurred on Monday, July 31st. The shares were sold at an average price of $61.06, for a total transaction of $74,981.68. Following the completion of the transaction, the senior vice president now owns 13,085 shares of the company’s stock, valued at $798,970.10. The disclosure for this sale can be found here. Insiders sold 157,002 shares of company stock valued at $9,694,424 over the last quarter. Insiders own 0.96% of the company’s stock.

Several institutional investors have recently bought and sold shares of the company. BlackRock Inc. boosted its holdings in shares of Discover Financial Services by 3,280.4% in the first quarter. BlackRock Inc. now owns 30,704,582 shares of the financial services provider’s stock valued at $2,099,886,000 after acquiring an additional 29,796,268 shares in the last quarter. Vanguard Group Inc. boosted its holdings in shares of Discover Financial Services by 0.9% in the second quarter. Vanguard Group Inc. now owns 25,748,479 shares of the financial services provider’s stock valued at $1,601,297,000 after acquiring an additional 217,535 shares in the last quarter. State Street Corp boosted its holdings in shares of Discover Financial Services by 6.1% in the fourth quarter. State Street Corp now owns 21,146,396 shares of the financial services provider’s stock valued at $1,524,446,000 after acquiring an additional 1,207,103 shares in the last quarter. Boston Partners boosted its holdings in shares of Discover Financial Services by 11.9% in the second quarter. Boston Partners now owns 16,727,596 shares of the financial services provider’s stock valued at $896,432,000 after acquiring an additional 1,784,386 shares in the last quarter. Finally, JPMorgan Chase & Co. boosted its holdings in shares of Discover Financial Services by 0.7% in the first quarter. JPMorgan Chase & Co. now owns 12,546,613 shares of the financial services provider’s stock valued at $858,062,000 after acquiring an additional 91,440 shares in the last quarter. Institutional investors and hedge funds own 85.45% of the company’s stock.

Discover Financial Services Company Profile

Discover Financial Services (DFS) is a direct banking and payment services company. The Company is a bank holding company, as well as a financial holding company. The Company operates through two segments: Direct Banking and Payment Services. It provides direct banking products and services, and payment services through its subsidiaries.

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