New Constructs

Stock Pick of the Week: Buy Discover Financial Services (DFS)- Very Attractive Rating

HIDDEN GEMS: 1. Our dis­counted cash flow analy­sis shows that DFS’s cur­rent val­u­a­tion (stock price of $21.80) implies that the company’s prof­its will decline by 40% and never grow again. 2. Eco­nomic earn­ings are growing faster that reported accounting earnings. 3. Free cash flow of $2.8bn or 24% of its enterprise value during the last fiscal year.
by David Trainer, Founder & CEO