Why Discover Financial Services Stock Dropped Today
Shares of Discover Financial Services (NYSE: DFS) fell 10.8% on Thursday after the company announced mixed fourth-quarter 2023 results relative to Wall Street's expectations.
More specifically, Discover's fourth-quarter revenue (net of interest expense) grew 13% year over year to $4.196 billion, beating consensus estimates for $4.11 billion. On the bottom line, however, Discover's net income declined to $388 million, or $1.54 per share, down 59% from $3.74 per share in the same year-ago period and well below estimates for $2.51 per share.
Discover Interim CEO John Owen stated the company enjoyed "strong asset and deposit growth and a resilient net interest margin." And while total net charge-off rates -- that is, the rate of debts that the company believes are no longer collectable -- grew by 198 basis points to 4.11%, Owen noted that was near the low end of the company's expected range.
Source Fool.com
