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Discover Financial Services PE Ratio

: 7.63 (As of Today)
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The PE Ratio, or Price-to-Earnings ratio, or P/E Ratio, is a financial ratio used to compare a company's market price to its Earnings per Share (Diluted). As of today (2022-01-17), Discover Financial Services's share price is $127.54. Discover Financial Services's Earnings per Share (Diluted) for the trailing twelve months (TTM) ended in Sep. 2021 was $16.72. Therefore, Discover Financial Services's PE Ratio for today is 7.63.


The historical rank and industry rank for Discover Financial Services's PE Ratio or its related term are showing as below:

NYSE:DFS' s PE Ratio Range Over the Past 10 Years
Min: 3.78   Med: 10.46   Max: 27.23
Current: 7.63

3.78
27.23

During the past 13 years, the highest PE Ratio of Discover Financial Services was 27.23. The lowest was 3.78. And the median was 10.46.


NYSE:DFS's PE Ratio is ranked higher than
76% of the 382 Companies
in the Credit Services industry.

( Industry Median: 14.87 vs. NYSE:DFS: 7.63 )

Discover Financial Services's Earnings per Share (Diluted) for the three months ended in Sep. 2021 was $3.54. Its Earnings per Share (Diluted) for the trailing twelve months (TTM) ended in Sep. 2021 was $16.72.

As of today (2022-01-17), Discover Financial Services's share price is $127.54. Discover Financial Services's EPS without NRI for the trailing twelve months (TTM) ended in Sep. 2021 was $16.72. Therefore, Discover Financial Services's PE Ratio without NRI for today is 7.63.

During the past 13 years, Discover Financial Services's highest PE Ratio without NRI was 27.23. The lowest was 3.78. And the median was 10.46.

Discover Financial Services's EPS without NRI for the three months ended in Sep. 2021 was $3.54. Its EPS without NRI for the trailing twelve months (TTM) ended in Sep. 2021 was $16.72.

During the past 12 months, Discover Financial Services's average EPS without NRI Growth Rate was -60.40% per year. During the past 3 years, the average EPS without NRI Growth Rate was -12.70% per year. During the past 5 years, the average EPS without NRI Growth Rate was -0.10% per year. During the past 10 years, the average EPS without NRI Growth Rate was 10.20% per year.

During the past 13 years, Discover Financial Services's highest 3-Year average EPS without NRI Growth Rate was 59.60% per year. The lowest was -15.30% per year. And the median was 7.20% per year.

Discover Financial Services's EPS (Basic) for the three months ended in Sep. 2021 was $3.54. Its EPS (Basic) for the trailing twelve months (TTM) ended in Sep. 2021 was $16.73.


Discover Financial Services PE Ratio Historical Data

The historical data trend for Discover Financial Services's PE Ratio can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Discover Financial Services Annual Data
Trend Nov11 Nov12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20
PE Ratio
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 12.49 14.19 7.57 9.34 25.15

Discover Financial Services Quarterly Data
Dec16 Mar17 Jun17 Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21
PE Ratio Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 17.78 25.15 10.70 7.57 7.35

Competitive Comparison

For the Credit Services subindustry, Discover Financial Services's PE Ratio, along with its competitors' market caps and PE Ratio data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

Discover Financial Services PE Ratio Distribution

For the Credit Services industry and Financial Services sector, Discover Financial Services's PE Ratio distribution charts can be found below:

* The bar in red indicates where Discover Financial Services's PE Ratio falls into.



Discover Financial Services PE Ratio Calculation

The PE Ratio, or Price-to-Earnings ratio, or P/E Ratio, is a financial ratio used to compare a company's market price to its Earnings per Share (Diluted). It is the most widely used ratio in the valuation of stocks.

Discover Financial Services's PE Ratio for today is calculated as

PE Ratio=Share Price/Earnings per Share (Diluted) (TTM)
=127.54/16.720
=7.63

Discover Financial Services's Share Price of today is $127.54.
Discover Financial Services's Earnings per Share (Diluted) for the trailing twelve months (TTM) ended in Sep. 2021 adds up the quarterly data reported by the company within the most recent 12 months, which was $16.72.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

It can also be calculated from the numbers for the whole company:


There are at least three kinds of PE Ratios used by different investors. They are Trailing Twelve Month PE Ratio or PE Ratio (TTM), Forward PE Ratio, or PE Ratio without NRI. A new PE Ratio based on inflation-adjusted normalized PE Ratio is called Shiller PE Ratio, after Yale professor Robert Shiller.

In the calculation of PE Ratio, the earnings per share used are the earnings per share over the past 12 months. For Forward PE Ratio, the earnings are the expected earnings for the next twelve months. In the case of PE Ratio without NRI, the reported earnings less the non-recurring items are used.

For Shiller PE Ratio, the earnings of the past 10 years are inflation-adjusted and averaged. Since it looks at the average over the last 10 years, Shiller PE Ratio is also called PE10.


Discover Financial Services  (NYSE:DFS) PE Ratio Explanation

The PE Ratio can be viewed as the number of years it takes for the company to earn back the price you pay for the stock. For example, if a company earns $2 a share per year, and the stock is traded at $30, the PE Ratio is 15. Therefore it takes 15 years for the company to earn back the $30 you paid for its stock, assuming the earnings stays constant over the next 15 years.

In real business, earnings never stay constant. If a company can grow its earnings, it takes fewer years for the company to earn back the price you pay for the stock. If a company's earnings decline it takes more years. As a shareholder, you want the company to earn back the price you pay as soon as possible. Therefore, lower P/E stocks are more attractive than higher P/E stocks so long as the PE Ratio is positive. Also for stocks with the same PE Ratio, the one with faster growth business is more attractive.

If a company loses money, the PE Ratio becomes meaningless.

To compare stocks with different growth rates, Peter Lynch invented a ratio called PEG Ratio. PEG Ratio is defined as the PE Ratio divided by the growth ratio. He thinks a company with a PE Ratio equal to its growth rate is fairly valued. Still he said he would rather buy a company growing 20% a year with a PE Ratio of 20, instead of a company growing 10% a year with a PE Ratio of 10.

Because the PE Ratio measures how long it takes to earn back the price you pay, the PE Ratio can be applied to the stocks across different industries. That is why it is the one of the most important and widely used indicators for the valuation of stocks.

Similar to the PE Ratio without NRI or PS Ratio or Price-to-Operating-Cash-Flow or Price-to-Free-Cash-Flow , the PE Ratio measures the valuation based on the earning power of the company. This is where it is different from the PB Ratio , which measures the valuation based on the company's balance sheet.


Be Aware

Investors need to be aware that the PE Ratio can be misleading a lot of times, especially when the underlying business is cyclical and unpredictable. As Peter Lynch pointed out, cyclical businesses have higher profit margins at the peaks of the business cycles. Their earnings are high and PE Ratios are artificially low. It is usually a bad idea to buy a cyclical business when the PE Ratio is low. A better ratio to identify the time to buy a cyclical businesses is the PS Ratio .

PE Ratio can also be affected by non-recurring-items such as the sale of part of businesses. This may increase for the current year or quarter dramatically. But it cannot be repeated over and over. Therefore PE Ratio without NRI is a more accurate indication of valuation than PE Ratio.


Discover Financial Services PE Ratio Related Terms

Thank you for viewing the detailed overview of Discover Financial Services's PE Ratio provided by GuruFocus.com. Please click on the following links to see related term pages.


Discover Financial Services Business Description

Discover Financial Services logo
Industry
Financial Services » Credit Services NAICS : 522210 SIC : 6141
Address
2500 Lake Cook Road, Riverwoods, IL, USA, 60015
Discover Financial Services is a bank operating in two distinct segments: direct banking and payment services. The company issues credit and debit cards and provides other consumer banking products including deposit accounts, students loans, and other personal loans. It also operates the Discover, Pulse, and Diners Club networks. The Discover network is the fourth-largest payment network in the United States as ranked by overall purchase volume, and Pulse is one of the largest ATM networks in the country.
Executives
Greene John officer: EVP & Chief Financial Officer 51 LIME STREET LONDON X0 EC3M 7DQ
Walcott Wanjiku Juanita officer: EVP, Chief Legal Officer & GC 2500 LAKE COOK ROAD RIVERWOODS IL 60015
Bush Mary K director 3509 WOODBINE STREET CHEVY CHASE MD 20815
Thierer Mark director DENTSPLY SIRONA INC 221 W PHILADELPHIA ST, STE 60W YORK PA 17401-2991
Wong Jennifer L. director C/O TIME INC. 225 LIBERTY STREET NEW YORK NY 10281
Case Gregory C director C/O AON CORPORATE LAW DEPT 200 EAST RANDOLPH ST, 8TH FL CHICAGO IL 60601
Maheras Thomas G director C/O CITIGROUP INC. 425 PARK AVENUE 2ND FLOOR NEW YORK NY 10043
Duncan Candace H director 2500 LAKE COOK ROAD RIVERWOODS IL 60015
Aronin Jeffrey S director 1515 WEST 22ND STREET SUITE 1210 OAK BROOK IL 60523
Moskow Michael H director 444 WEST LAKE STREET, STE. 4700 CHICAGO IL 60606
Glassman Cynthia A director 2500 LAKE COOK ROAD RIVERWOODS IL 60015
Eazor Joseph F director 1170 PEACHTREE STREET, SUITE 900 ATLANTA GA 30309
Hochschild Roger C director, officer: CEO and President 2500 LAKE COOK ROAD RIVERWOODS IL 60015
Eichfeld Robert Andrew officer: EVP - Chief HR & Admin Officer 2500 LAKE COOK ROAD RIVERWOODS IL 60015
Arooni Amir S officer: EVP, Chief Information Officer 2500 LAKE COOK ROAD RIVERWOODS RIVERWOODS IL 60015

Discover Financial Services Headlines

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