Credit card issuer Discover Financial (DFS, Financial) increased the Fund’s return by 60 basis points, as its stock leapt from $94.99 to $118.29, for a total return of 25.0%. Discover is a digital bank and payment services company. It offers a variety of consumer banking products and operates one of the largest payment networks. Like Capital One, Discover benefitted from an extremely favorable consumer credit environment. The company’s charge-off rates were significantly below pre-pandemic levels and remained low month after month. Lower credit losses, combined with higher efficiency and cost controls at the company, resulted in explosive profits for investors.
From the Parnassus Endeavor Fund (Trades, Portfolio)'s second-quarter 2021 commentary.
