UPDATE: Bank of America Merrill Lynch Reiterates Buy Rating, Raises PT on Discover Financial Services
In a report published Friday, Bank of America Merrill Lynch reiterated its Buy rating on Discover Financial Services (NYSE: DFS), and raised its price target from $40.00 to $47.00.
BofA Merrill Lynch noted, “DFS reported strong core Q3'12 results, well above expectations, and provided equally strong commentary on its earnings call, bolstering the bullish sentiment that has surrounded DFS for some time now. The stock was up 7.3% on the day. What we find most encouraging is the earnings leverage DFS has to favorable credit. The current backdrop is good and will likely persist. That said, 2013 estimates are too low, in our view, and will continue to chase DFS shares higher. Given strong capital generation, we expect buybacks and dividend growth to drive DFS shares well into the mid-$40's. Credit will eventually turn, serving as a potent earnings drag. However, that day seems far enough in the future for DFS to move higher in the interim. Reiterate Buy rating.”
Discover Financial Services closed on Thursday at $39.71.
Latest Ratings for DFS
|Dec 2016||Bank of America||Upgrades||Neutral||Buy|
|Nov 2016||JMP Securities||Maintains||Market Outperform|
© 2017 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.