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Discover (DFS) Expands Market Reach With Exchange Credit Program

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Discover Financial Services (DFS - Free Report) recently announced a collaboration with the Exchange Credit Program to broaden acceptance of the MILITARY STAR card across military installations. This collaboration, set to start in September 2024, marks a significant expansion for Discover in the military market.

This move bodes well for DFS as it will be able to enhance service for military communities and provide seamless payment solutions through its Discover Global Network. The MILITARY STAR card, managed by the Army & Air Force Exchange Service, presently serves as a preferred payment method at various military retail outlets and facilities.

By transitioning to Discover’s network, more on-installation merchants will now accept the card, including concessionaires, popular restaurants, and other service providers. This shift from a closed-loop system to Discover’s network will streamline transactions and offer cardholders greater convenience and accessibility.

Improved transaction volumes and an expanded customer base bode well for Discover. This move is a significant milestone for DFS as it aims to expand its network to benefit diverse customer groups, including military personnel and their close ones. Integrating Discover’s technology will also bring advanced security features such as EMV chip technology and tap-to-pay options to the MILITARY STAR card, ensuring improved protection and ease of use for cardholders.

As the MILITARY STAR card continues to evolve under Discover’s network, both parties aim to strengthen financial services tailored to the unique needs of military members. The benefits of the MILITARY STAR card remain unchanged. This partnership is expected to benefit DFS’s Payment Services segment, whose pre-tax income improved 74.5% year over year in the first quarter of 2024.

Price Performance

Discover’s shares have gained 14.9% in the year-to-date period compared with 8.9% growth of the industry.

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Zacks Rank & Key Picks

Discover currently has a Zacks Rank #3 (Hold).

Investors interested in the broader Finance space may look at some better-ranked players like Hut 8 Corp. (HUT - Free Report) , WisdomTree, Inc. (WT - Free Report) , and HIVE Digital Technologies Ltd. (HIVE - Free Report) . Each stock presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for Hut 8’s current-year earnings is pegged at $2.50 per share, which witnessed one upward estimate revision in the past 60 days against no downward movement. The consensus mark for HUT’s current-year revenues suggests a 55.9% jump from a year ago.

The Zacks Consensus Estimate for WisdomTree’s 2024 earnings indicates 51.4% year-over-year growth. During the past two months, WT has witnessed one upward estimate revision against none in the opposite direction. It met earnings estimates thrice in the past four quarters and beat once, with an average surprise of 2.3%.

The Zacks Consensus Estimate for HIVE Digital’s current-year earnings suggests a 29.1% year-over-year improvement. During the past month, HIVE has witnessed one upward estimate revision against none in the opposite direction. The consensus mark for current-year revenues is pegged at $111.8 million.


 

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