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Key Takeaways

• Discover Financial Services shares paced the S&P 500 Monday on word interim CEO J. Michael Shepherd has agreed to stay on through the completion of Capital One Financial's purchase of the credit card provider.

• Last week, Shepherd and Discover agreed on a contract that could pay him as much as $5.65 million through June 30.

• Discover agreed in February 2024 to be purchased by Capital One for $35.3 billion.

Discover Financial Services (DFS) stock paced the S&P 500 during a mostly down day for equities markets Monday as investors continued to take a positive view of last week's announcement about its leadership situation.

Shares were up 5.5% in recent trading on word the credit card provider and J. Michael Shepherd had agreed for the interim CEO to remain on the job until rival Capital One Financial (COF) completes its planned purchase of Discover Financial.

The $35.3 billion deal was hammered out in February 2024 and is expected to close soon. The contract with Shepherd pays him a base salary of $1.75 million in April, and $750,000 for May and June. If the transaction is finalized before June 30, he'll get an additional $2.4 million as a bonus.

Shares of Discover Financial Services have climbed nearly 30% in the last year.

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