Following the announcement of Roger Hochschild’s immediate departure as CEO and President, along with his resignation from the Board, Discover Financial Services (NYSE:DFS) experienced a more than 10% drop in its stock price.
To facilitate a seamless transition, Hochschild will continue to advise the company until the end of the year. John Owen, a Board member, has been designated as the Interim CEO and President. The company started the process of finding a permanent replacement for the roles of CEO and President.
Following the announcement, Evercore ISI analysts included Discover Financial’s stock in Evercore’s Tactical Underperform List. The analysts noted that they anticipate the potential for ongoing regulatory risk, uncertainties in management, and possible negative impacts on returns to contribute to short-term underperformance compared to peers. They emphasized that the potential for additional regulatory actions and the uncertainty in leadership are expected to remain challenges for the company’s shares.