Discover Financial Services is scheduled to report its earnings on Thursday, April 24, 2025. Consensus estimates project earnings at $3.30 per share, up from just over $1 per share a year ago, while revenue is expected to remain steady at $4.21 billion. The company may benefit from improved net interest margins following the sale of its student loan portfolio last year, as it shifts focus to higher-yielding credit card balances. Additionally, growth in personal loans could provide some support. Discover’s stock has fallen around 10% year-to-date, amid broader market volatility due to trade tensions and uncertainty surrounding regulatory approval for its acquisition by Capital One (NYSE: COF). Related: Where does Capital One-Discover Deal stand?
Discover currently has a market capitalization of about $39 billion. Over the past twelve months, it recorded revenue of $18 billion and net income of $4.5 billion. For those seeking gains with lower volatility than individual stocks, the Trefis High-Quality portfolio offers an alternative, having outperformed the S&P 500 with returns of over 91% since its launch.
See the earnings reaction history of all stocks
Discover Financial Services’ Historical Odds Of Positive Post-Earnings Return
Here are some insights from one-day (1D) post-earnings returns:
- Over the last five years, there are 20 earnings data points, with 8 positive and 12 negative 1D returns, meaning positive 1D returns occurred about 40% of the time.
- This percentage slightly increases to 42% if only the last 3 years are considered.
- The median return for the 8 positive events = 2.8%, while the 12 negative events have a median return of -3.5%.
Additional details for 5-Day (5D) and 21-Day (21D) post-earnings returns are shown in the table below.
Correlation Between 1D, 5D, and 21D Historical Returns
A potentially lower-risk approach is to analyze the correlation between short-term and medium-term post-earnings returns and act on the strongest correlation. For instance, if 1D and 5D returns are highly correlated, one might go “long” for 5 days if the 1D return is positive. The chart below presents correlation data using five- and three-year histories. Note that 1D_5D denotes the correlation between 1D and 5D post-earnings returns.
Is There Any Correlation With Peer Earnings?
Sometimes, the stock performance of peers can influence post-earnings movements, even before earnings are announced. Below is historical data showing Discover’s one-day post-earnings stock movement alongside that of peers who reported just before Discover.
Learn more about the Trefis RV strategy, which has beaten its all-cap benchmark (a mix of the S&P 500, S&P MidCap, and Russell 2000), delivering solid returns for investors. Alternatively, if you’re seeking steadier performance compared to individual stocks like Discover, explore the High Quality portfolio, which has outpaced the S&P 500 and achieved returns above 91% since inception.
Invest with Trefis
Market Beating Portfolios | Rules-Based Wealth