Discover Financial Services (DFS): Solid call from MSCO
Get Alerts DFS Hot Sheet
Price: $126.03 -2.32%
Rating Summary:
19 Buy, 16 Hold, 1 Sell
Rating Trend: Down
Today's Overall Ratings:
Up: 11 | Down: 12 | New: 9
Rating Summary:
19 Buy, 16 Hold, 1 Sell
Rating Trend: Down
Today's Overall Ratings:
Up: 11 | Down: 12 | New: 9
Join SI Premium – FREE
From Notable Calls
It's fairly quiet out there this AM. Think the biggest call seems to be Morgan Stanley's upgrade on Discover Financial Services (NYSE: DFS):
- They are upgrading DFS to Overweight from Underweight as they think it will beat consensus estimates in 2008, thanks to more prudent underwriting (lower credit losses), more leverage in the net interest margin to Fed rate cuts, and limited vulnerability to gapping spreads in the unsecured funding markets. It now looks like more aggressive peers, such as AXP and COF, may have taken on more credit and funding risk than they should have, and the firm expects those companies to disappoint consensus estimates. They regard COF as exposed to subprime card and auto loans. AXP may be in for further problems as prime mortgage troubles spread through its card portfolio, and it is also heavily reliant on unsecured debt, where spreads are now widening. Longer term, they see value in the DFS spin-off story, which has yet to play through to its conclusion.
Firm's new tgt on DFS is $24 (up from $15).
Notablecalls: Looks like a really solid call from MSCO. I expect the stock to trade above $15 today.
For more calls go to http://notablecalls.blogspot.com/
It's fairly quiet out there this AM. Think the biggest call seems to be Morgan Stanley's upgrade on Discover Financial Services (NYSE: DFS):
- They are upgrading DFS to Overweight from Underweight as they think it will beat consensus estimates in 2008, thanks to more prudent underwriting (lower credit losses), more leverage in the net interest margin to Fed rate cuts, and limited vulnerability to gapping spreads in the unsecured funding markets. It now looks like more aggressive peers, such as AXP and COF, may have taken on more credit and funding risk than they should have, and the firm expects those companies to disappoint consensus estimates. They regard COF as exposed to subprime card and auto loans. AXP may be in for further problems as prime mortgage troubles spread through its card portfolio, and it is also heavily reliant on unsecured debt, where spreads are now widening. Longer term, they see value in the DFS spin-off story, which has yet to play through to its conclusion.
Firm's new tgt on DFS is $24 (up from $15).
Notablecalls: Looks like a really solid call from MSCO. I expect the stock to trade above $15 today.
For more calls go to http://notablecalls.blogspot.com/
You May Also Be Interested In
- META to capture largest share of users, SNAP to benefit from ad budget shifts - Canaccord Genuity weighs in on TikTok ban
- Keefe, Bruyette & Woods Reiterates Outperform Rating on Discover Financial (DFS)
- Sage Therapeutics (SAGE) PT Lowered to $18 at Truist Securities
Create E-mail Alert Related Categories
Analyst Comments, ContributorsRelated Entities
Morgan StanleySign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!