Discover Debuts as Public Company, Loses A Buck
By Seth Harbison
Discover Financial Services today debuted on the New York Stock Exchange after its spinoff from Morgan Stanley. Trading under the ticker symbol DFS, Discover’s share price declined a dollar to $27.50 in its first full day of open trading. The broader markets were all up significantly today, increasing by about one percent on the day.
Discover is the latest “pure play” card company to go public, trailing the very successful IPO of MasterCard last year, and debuting before the much-anticipated Visa IPO later this year.
Whether Discover can mimic MasterCard’s success remains to be seen, but as a much smaller player its prospects don’t seem quite as bright. And with Visa set to hit the markets, the enthusiasm for Discover seems to so far be tepid. But despite its small market share (estimated at less than 5% of total cards issued), Discover is also known to generate large amounts of cash, making it potentially attractive to either investors or a buyout group in the future.
