Barclays Stays Bullish on Discover Ahead of Q2 Earnings; Target Raised (DFS)

By Staff,

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Credit card issuer Discover Financial Services ( DFS ) on Wednesday caught some continued bullish support from analysts at Barclays Capital.

The firm reiterated its "Overweight" rating on DFS while boosting its price target from $37 to $39. That new target suggests an 18% upside to the stock's Tuesday closing price of $32.92.

A Barclays analyst commented, "When DFS reports fiscal 2Q12 earnings next Tuesday, June 19, we expect EPS of $1.05, compared to consensus of $0.95. Excluding reserve releases, our estimate would be $0.99…Based on recent credit trends, we are raising our full-year 2012-14 EPS estimates to $4.24, $3.88 and $3.94 respectively."

Discover shares posted small losses in afternoon trading Wednesday.

The Bottom Line
Shares of Discover Financial Services ( DFS ) have a 1.22% dividend yield, based on last night's closing stock price of $32.92. The stock has technical support in the $28-$30 price area. If the stock can firm up, we see overhead resistance around the all-time high levels of $34-$35 a share.

Discover Financial Services ( DFS ) is not recommended at this time, holding a DARS™ Rating of 3.4 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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This article appears in: Investing Stocks
Referenced Stocks: DFS

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