Discover Financial’s Estimate Cut at Barclays Capital (DFS)


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Credit card issuer Discover Financial Services ( DFS ) saw its earnings estimate lowered on Monday by analysts at Barclays Capital.

The firm said it lowered its full-year 2010 estimate for DFS from 40 cents, but noted that provisions should decline in 2010. Barclays Capital reiterated its "Overweight" rating and $18 price target on the stock, which would represent a more than 28% upside to DFS' Friday closing price of $14.

Discover Financial shares were mostly flat in premarket trading Monday.

The Bottom Line
We have avoided shares of DFS since our early June 2008 coverage began, when the stock was trading at $15.70. The company has a .57% dividend yield, based on Friday's closing stock price of $14.00. The stock has technical support in the $12 price area. If the shares can firm up, we see overhead resistance around the $16 price level. We would remain on the sidelines for now.

Discover Financial Services ( DFS ) is not recommended at this time, holding a DARS™ Rating of 3.3 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

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