Discover price target raised to $130 from $129 at Piper Sandler

Piper Sandler raised the firm’s price target on Discover Financial to $130 from $129 and keeps an Overweight rating on the shares. The analyst says consumer lenders have broadly outperformed the market and banking peers since the Q1 earnings as recession fears have abated in recent weeks. However, a recession with rising unemployment “remains a significant overhang for consumer lenders and the market in general,” the analyst tells investors in a research note. In addition, the firm has become increasingly concerned higher interest rates and the re-start of student debt payments could present an incremental headwind to spending and credit in the back half of the year. Piper expects consumer finance valuation multiples to “remain subdued in the near-term before improving comps can lead to more reasonable multiple.”