Discover financial services (DFS) – Get the Discover Financial Services report stocks slipped Thursday, as analysts reacted to weaker-than-expected loan growth and net interest income for the second quarter.
The credit card company recently traded at $ 123.69, down 1.48%. It has jumped 31% in the past six months amid the economic rebound.
“Much ado” filled the second quarter earnings report, Vital Knowledge founder Adam Crisafulli said, according to Bloomberg. He noted growth in net interest income and “lukewarm” lending, although the results were largely in line with bank profits.
Piper Sandler analyst Kevin Barker wrote: “Basic pre-provision net sales were roughly in line with our estimate, but we saw a noticeable decline in loan balances year over year. ‘other and compared to our estimates, “according to Bloomberg.
Discover posted second-quarter net income of $ 1.7 billion, or $ 5.55 per share, compared to a pandemic-induced loss of $ 368 million, $ 1.20 per share, last year .
FactSet analyst consensus reported earnings of $ 4.11 per share in the last quarter.
Net interest income increased 5% from a year ago to $ 2.3 billion. Revenue, net of interest expense, totaled $ 3.58 billion, exceeding analysts’ expectations of $ 2.9 billion.
Earlier this month, Citigroup upgraded Discover to Buy from Neutral, saying it has everything to gain from the increase in consumer payments.
Analyst Arren Cyganovich also raised his price target to $ 150 from $ 101. Discover has the “clearest short-term path” to profit from the country’s economic reopening, the analyst said.
Barclays analysts also raised their price target to $ 146 from $ 132, while claiming an overweighting.