From Nasdaq:

Discover Financial Services (DFS) is set to report strong fourth-quarter earnings on Jan 17. Anticipated sustained growth in net interest income and Payment Services revenues are expected to contribute to its performance. The Zacks Consensus Estimate for fourth-quarter earnings per share stands at $2.50, indicating a 33.2% decrease from last year.

Despite the expected decrease, the Zacks model predicts a likely earnings beat for Discover Financial. Enhanced growth in new accounts and rising debit transaction volume are anticipated to positively impact its performance in the fourth quarter. The company’s prudent approach to underwriting and marketing non-card products is also expected to play a crucial role in its performance.

However, high reward costs and escalating operating expenses may pose a challenge for Discover Financial’s bottom line. Marketing costs and provisions for bad loans are also expected to have an adverse impact on its fourth-quarter results. The company is determined to invest in technology and card and consumer banking products, which may lead to higher professional fees and employee compensation.

In addition to Discover Financial, Coinbase Global, Chubb Limited, and Brookfield Asset Management are also worth considering for potential earnings beats. These companies have the right combination of elements to outperform on earnings during this quarter. As the electric vehicle revolution continues to expand, investors can also target gains by focusing on lithium battery stocks, as demand for lithium batteries is expected to increase significantly due to the growing EV market.



Read more: Can Interest Income Drive Discover Financial’s (DFS) Q4 Earnings?