On March 23, 2023 at 15:12:40 ET an unusually large $12.10K block of Call contracts in Discover Financial Services (DFS) was bought, with a strike price of $97.00 / share, expiring in 1 days (on March 24, 2023). Fintel tracks all large options trades, and the premium spent on this trade was ? sigmas above the mean, placing it in the 99.88 percentile of all recent large trades made in DFS options.
This trade was first picked up on Fintel’s real time Unusual Option Trades tool, where unusual option trades are highlighted.
Analyst Price Forecast Suggests 26.07% Upside
As of March 23, 2023, the average one-year price target for Discover Financial Services is $119.49. The forecasts range from a low of $105.04 to a high of $138.60. The average price target represents an increase of 26.07% from its latest reported closing price of $94.78.
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The projected annual revenue for Discover Financial Services is $14,658MM, an increase of 33.52%. The projected annual non-GAAP EPS is $14.06.
What is the Fund Sentiment?
There are 1774 funds or institutions reporting positions in Discover Financial Services. This is an increase of 29 owner(s) or 1.66% in the last quarter. Average portfolio weight of all funds dedicated to DFS is 0.28%, an increase of 7.50%. Total shares owned by institutions decreased in the last three months by 2.19% to 266,949K shares. The put/call ratio of DFS is 0.92, indicating a bullish outlook.
What are Large Shareholders Doing?
Capital World Investors holds 18,919K shares representing 7.22% ownership of the company. In it’s prior filing, the firm reported owning 17,690K shares, representing an increase of 6.50%. The firm increased its portfolio allocation in DFS by 9.26% over the last quarter.
VTSMX – Vanguard Total Stock Market Index Fund Investor Shares holds 8,292K shares representing 3.17% ownership of the company. In it’s prior filing, the firm reported owning 8,155K shares, representing an increase of 1.64%. The firm increased its portfolio allocation in DFS by 1.03% over the last quarter.
AWSHX – WASHINGTON MUTUAL INVESTORS FUND holds 6,603K shares representing 2.52% ownership of the company. In it’s prior filing, the firm reported owning 8,912K shares, representing a decrease of 34.97%. The firm decreased its portfolio allocation in DFS by 21.18% over the last quarter.
VIMSX – Vanguard Mid-Cap Index Fund Investor Shares holds 6,363K shares representing 2.43% ownership of the company. In it’s prior filing, the firm reported owning 6,295K shares, representing an increase of 1.08%. The firm decreased its portfolio allocation in DFS by 0.09% over the last quarter.
VFINX – Vanguard 500 Index Fund Investor Shares holds 6,316K shares representing 2.41% ownership of the company. In it’s prior filing, the firm reported owning 6,193K shares, representing an increase of 1.96%. The firm increased its portfolio allocation in DFS by 1.11% over the last quarter.
Discover Financial Services Declares $0.60 Dividend
On January 18, 2023 the company declared a regular quarterly dividend of $0.60 per share ($2.40 annualized). Shareholders of record as of February 23, 2023 received the payment on March 9, 2023. Previously, the company paid $0.60 per share.
At the current share price of $94.78 / share, the stock’s dividend yield is 2.53%. Looking back five years and taking a sample every week, the average dividend yield has been 2.27%, the lowest has been 1.39%, and the highest has been 6.60%. The standard deviation of yields is 0.72 (n=237).
The current dividend yield is 0.36 standard deviations above the historical average.
Additionally, the company’s dividend payout ratio is 0.14. The payout ratio tells us how much of a company’s income is paid out in dividends. A payout ratio of one (1.0) means 100% of the company’s income is paid in a dividend. A payout ratio greater than one means the company is dipping into savings in order to maintain its dividend – not a healthy situation. Companies with few growth prospects are expected to pay out most of their income in dividends, which typically means a payout ratio between 0.5 and 1.0. Companies with good growth prospects are expected to retain some earnings in order to invest in those growth prospects, which translates to a payout ratio of zero to 0.5.
The company’s 3-Year dividend growth rate is 0.36%, demonstrating that it has increased its dividend over time.
Discover Financial Services Background Information
(This description is provided by the company.)
Discover Financial Servicesis a digital banking and payment services company with one of the most trusted brands in U.S. financial services. Since its inception in 1986, the company has become one of the largest card issuers in the United States. The company issues the Discover card, America’s cash rewards pioneer, and offers private student loans, personal loans, home loans, checking and savings accounts and certificates of deposit through its banking business. It operates the Discover Global Network comprised of Discover Network, with millions of merchant and cash access locations; PULSE, one of the nation’s leading ATM/debit networks; and Diners Club International, a global payments network with acceptance around the world.
This article originally appeared on Fintel
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