Discover Financial Shares Owned By Insiders vs. Return On Equity

DFS Stock  USD 179.22  1.92  1.08%   
Taking into consideration Discover Financial's profitability measurements, Discover Financial's profitability may be sliding down. It has an above-average chance of reporting lower numbers next quarter. Profitability indicators assess Discover Financial's ability to earn profits and add value for shareholders. At this time, Discover Financial's Price To Sales Ratio is comparatively stable compared to the past year. EV To Sales is likely to gain to 3.92 in 2024, whereas Days Sales Outstanding is likely to drop 23.60 in 2024. At this time, Discover Financial's Income Tax Expense is comparatively stable compared to the past year. Net Income Applicable To Common Shares is likely to gain to about 5.2 B in 2024, whereas Operating Income is likely to drop slightly above 4.6 B in 2024.
Current ValueLast YearChange From Last Year 10 Year Trend
Gross Profit Margin1.981.88
Notably Up
Slightly volatile
Net Profit Margin0.190.2987
Way Down
Slightly volatile
Operating Profit Margin0.610.5196
Fairly Up
Slightly volatile
Pretax Profit Margin0.290.3887
Way Down
Slightly volatile
Return On Assets0.0210.0194
Significantly Up
Pretty Stable
Return On Equity0.160.1983
Significantly Down
Pretty Stable
For Discover Financial profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Discover Financial to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Discover Financial Services utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Discover Financial's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Discover Financial Services over time as well as its relative position and ranking within its peers.
  

Discover Financial's Revenue Breakdown by Earning Segment

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Is Consumer Finance space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Discover Financial. If investors know Discover will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Discover Financial listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth
0.426
Dividend Share
2.8
Earnings Share
12.42
Revenue Per Share
46.558
Quarterly Revenue Growth
0.605
The market value of Discover Financial is measured differently than its book value, which is the value of Discover that is recorded on the company's balance sheet. Investors also form their own opinion of Discover Financial's value that differs from its market value or its book value, called intrinsic value, which is Discover Financial's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Discover Financial's market value can be influenced by many factors that don't directly affect Discover Financial's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Discover Financial's value and its price as these two are different measures arrived at by different means. Investors typically determine if Discover Financial is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Discover Financial's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.

Discover Financial Return On Equity vs. Shares Owned By Insiders Fundamental Analysis

Comparative valuation techniques use various fundamental indicators to help in determining Discover Financial's current stock value. Our valuation model uses many indicators to compare Discover Financial value to that of its competitors to determine the firm's financial worth.
Discover Financial Services is rated below average in shares owned by insiders category among its peers. It also is rated below average in return on equity category among its peers reporting about  0.36  of Return On Equity per Shares Owned By Insiders. The ratio of Shares Owned By Insiders to Return On Equity for Discover Financial Services is roughly  2.81 . At this time, Discover Financial's Return On Equity is comparatively stable compared to the past year. Comparative valuation analysis is a catch-all technique that is used if you cannot value Discover Financial by discounting back its dividends or cash flows. It compares the stock's price multiples to nearest competition to determine if the stock is relatively undervalued or overvalued.

Discover Return On Equity vs. Shares Owned By Insiders

Shares Owned by Insiders show the percentage of outstanding shares owned by insiders (such as principal officers or members of the board of directors) or private individuals and entities with over 5% of the total shares outstanding. Company executives or private individuals with access to insider information share information about a firm's operations that is not available to the general public.

Discover Financial

Insiders Shares

 = 

Executives Shares

+

Employees

 = 
0.57 %
Although the research on effects of insider trading on prices and volatility is still relatively inconclusive, and investors are advised to pay close attention to the distribution of equities among company's stakeholders to avoid many problems associated with the disclosure of price-sensitive information.
Return on Equity or ROE tells company stockholders how effectually their money is being utilized or reinvested. It is a useful ratio when analyzing company profitability or the management effectiveness given the capital invested by the shareholders. ROE shows how efficiently a company utilizes investments to generate income.

Discover Financial

Return On Equity

 = 

Net Income

Total Equity

 = 
0.2
For most industries, Return on Equity between 10% and 30% are considered desirable to provide dividends to owners and have funds for the future growth of the company. Investors should be very careful using ROE as the only efficiency indicator because ROE can be high if a company is heavily leveraged.

Discover Return On Equity Comparison

Discover Financial is currently under evaluation in return on equity category among its peers.

Discover Financial Profitability Projections

The most important aspect of a successful company is its ability to generate a profit. For investors in Discover Financial, profitability is also one of the essential criteria for including it into their portfolios because, without profit, Discover Financial will eventually generate negative long term returns. The profitability progress is the general direction of Discover Financial's change in net profit over the period of time. It can combine multiple indicators of Discover Financial, where stable trends show no significant progress. An accelerating trend is seen as positive, while a decreasing one is unfavorable. A rising trend means that profits are rising, and operational efficiency may be rising as well. A decreasing trend is a sign of poor performance and may indicate upcoming losses.
Last ReportedProjected for Next Year
Accumulated Other Comprehensive Income-225 M-213.8 M
Operating Income5.1 B4.6 B
Income Before Tax3.8 B3.2 B
Total Other Income Expense Net-1.3 B-1.4 B
Net Income2.9 B2.3 B
Income Tax Expense886 MB
Net Income Applicable To Common Shares4.9 B5.2 B
Net Income From Continuing Ops3.6 BB
Net Interest Income12.7 B10.1 B
Interest Income16.8 B12.3 B
Change To Netincome2.7 B2.5 B
Net Income Per Share 11.57  12.15 
Income Quality 2.93  2.74 
Net Income Per E B T 0.77  0.54 

Discover Profitability Driver Comparison

Profitability drivers are factors that can directly affect your investment outlook on Discover Financial. Investors often realize that things won't turn out the way they predict. There are maybe way too many unforeseen events and contingencies during the holding period of Discover Financial position where the market behavior may be hard to predict, tax policy changes, gold or oil price hikes, calamities change, and many others. The question is, are you prepared for these unexpected events? Although some of these situations are obviously beyond your control, you can still follow the important profit indicators to know where you should focus on when things like this occur. Below are some of the Discover Financial's important profitability drivers and their relationship over time.

Use Discover Financial in pair-trading

One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Discover Financial position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Discover Financial will appreciate offsetting losses from the drop in the long position's value.

Discover Financial Pair Trading

Discover Financial Services Pair Trading Analysis

The ability to find closely correlated positions to Discover Financial could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Discover Financial when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Discover Financial - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Discover Financial Services to buy it.
The correlation of Discover Financial is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Discover Financial moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Discover Financial moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Discover Financial can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
Pair CorrelationCorrelation Matching

Use Investing Themes to Complement your Discover Financial position

In addition to having Discover Financial in your portfolios, you can quickly add positions using our predefined set of ideas and optimize them against your very unique investing style. A single investing idea is a collection of funds, stocks, ETFs, or cryptocurrencies that are programmatically selected from a pull of investment themes. After you determine your investment opportunity, you can then find an optimal portfolio that will maximize potential returns on the chosen idea or minimize its exposure to market volatility.

Did You Try This Idea?

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Soft Drinks
Soft Drinks Theme
Entities manufacturing and distributing non alcoholic beverages across different markets. The Soft Drinks theme has 40 constituents at this time.
You can either use a buy-and-hold strategy to lock in the entire theme or actively trade it to take advantage of the short-term price volatility of individual constituents. Macroaxis can help you discover thousands of investment opportunities in different asset classes. In addition, you can partner with us for reliable portfolio optimization as you plan to utilize Soft Drinks Theme or any other thematic opportunities.
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Additional Tools for Discover Stock Analysis

When running Discover Financial's price analysis, check to measure Discover Financial's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Discover Financial is operating at the current time. Most of Discover Financial's value examination focuses on studying past and present price action to predict the probability of Discover Financial's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Discover Financial's price. Additionally, you may evaluate how the addition of Discover Financial to your portfolios can decrease your overall portfolio volatility.