Discover Financial Services

DFS

Not Compliant
Exchange
Sector
Headquarters
Group
NYSE
Financials
United States of America
Large cap

Discover Financial Services is not Shariah Compliant because of its involvement in Banks (NEC) and related activities.

-

Impure Income*

-

Purification*

-

Zakat*

Financials

Market cap Group
Analysts' Rating
Price Target (Mean)
Price Target (Low)
Price Target (High)
Total Analysts
Large cap
HOLD
$148.55
$118.00
$170.00
18
Revenue Growth
Operating Margin
Net Profit Margin
Quick Ratio
Current Ratio
EPS Growth
17.02%
0.00%
30.60%
0.00
0.00
450.91%

Shariah Compliance

  • Updated on September 12, 2024
Debt
51.95%
✗
Non-Compliant Assets
38.79%
✗
Impure Income

AAOIFI Rulebook:

  • Non-compliant Liabilities (like Interest-based Debt) < 30% of Market cap
  • Non-compliant Assets (like Interest-based Investments) < 30% of Market cap
  • Impure Revenues (incl. Interest Income) < 5% of Total Revenues

Source: AAOIFI SS21

Debt
61.20%
✗
Impure Income

S&P Sharia Rulebook:

  • Interest-based Debt < 33% of 36-mo avg. Market cap
  • Impure Revenues (incl. Interest Income) < 5% of Total Revenues

Source: S&P Shariah Methodology

Debt
64.30%
✗
Impure Income

Dow Jones Islamic Market (DJIM) Rulebook:

  • Interest-based Debt < 33% of 24-mo avg. Market cap
  • Impure Revenues (incl. Interest Income) < 5% of Total Revenues

Source: DJIM Methodology

Debt
11.99%
✓
Cash
8.95%
✓
Cash & AR
8.95%
✓
Impure Income

FTSE Shariah Rulebook:

  • Interest-based Debt < 33.33% of Total Assets
  • Cash and interest-bearing items < 33.33% of Total Assets
  • Accounts receivable and cash < 50% of Total Assets
  • Impure Revenues (incl. Interest Income) < 5% of Total Revenues

Source: FTSE RUSSELL

Debt
11.99%
✓
Cash
8.95%
✓
Cash & AR
8.95%
✓
Impure Income

MSCI Islamic Rulebook:

  • Interest-based Debt < 33.33% of Total Assets
  • Cash and interest-bearing items < 33.33% of Total Assets
  • Accounts receivable and cash < 33.33% of Total Assets
  • Impure Revenues (incl. Interest Income) < 5% of Total Revenues

Source: MSCI Islamic Indexes

Impure Income Breakdown

-
-
Interest Income
-

Note on Purification and Zakat:

  • Purification and Zakat (for long-term investing) calculations are in USD per share and based on AAOIFI methodology. AAOIFI requires purification every financial period (e.g. quarterly). 
  • If you follow S&P Shariah’s Dividend-only purification, then remove the impure income % from the dividends you receive. No purification required for non-dividend paying stocks, according to S&P Shariah.
  • For Zakat, if you did not invest in a company from a long term perspective, then consider the shares as trading goods and give 2.5% of the total value if a year has passed on them. 

Company Profile

Discover Financial Services is a digital banking and payment services company. The Company is a bank holding company, as well as a financial holding company. The Company operates through two segments: Digital Banking and Payment Services. Its Digital Banking segment includes consumer banking and lending products, specifically Discover-branded credit cards issued to individuals on the Discover Network and other consumer banking products and services, including private student loans, personal loans, home loans and deposit products. Its Payment Services segment includes PULSE, Diners Club, and its Network Partners business, which provides payment transaction processing and settlement services on the Discover Global Network. Its processing services covers four functional areas such as card personalization, print/mail, remittance processing and item processing. Its private student loans are primarily available to students attending eligible non-profit undergraduate and graduate schools.

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