A month has gone by since the last earnings report for Discover (DFS). Shares have lost about 4.2% in that time frame, underperforming the S&P 500.Will the recent negative trend continue leading up to its next earnings release, or is Discover due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers. Discover Financial Q4 Earnings Surpass, Improve Y/YDiscover Financial reported fourth-quarter 2020 adjusted earnings of $2.59 per share, beating the Zacks Consensus Estimate of $2.37 by 9.3%.Moreover, the bottom line improved 15% year over year owing to a solid performance by its Direct Banking business. The company witnessed strong growth in its digital banking model.Operational UpdateIn the reported quarter, the company’s revenues — net of interest expenses — dropped 4% year over year to $2.8 billion due to lower other income.However, the top line beat the Zacks Consensus Estimate by 0.1%.Total loans declined 6% year over year to $90.4 billion.Interest expenses of $383 million decreased 37.7% year over year.Total operating expenses increased 8% to $1.3 billion due to higher one-time expense items and rise in compensation. However, the same was partly offset by decreased marketing and professional fees.Segmental UpdateDirect Banking SegmentThis segment’s pre-tax income came in at $991 million, up 12.2% year over year owing to a decrease in the provision for credit losses. This was partly offset by lower revenue, net ofinterest expense as well as increased operating costs.Total loans dipped 6% year over year to $90.4 billion. Credit card loans fell 7% to $71.5 billion.Personal loans were down 7% while private student loans inched up 3%, both on a year-over-year basis. Net interest income slipped 2% year over year due to lower average receivables and an unfavorable net impact from lower market rates.Net interest margin was 10.63%, up 34 basis points from the year-ago quarter.Payment Services SegmentPayment Services pre-tax income was $24 million in the quarter under review, down 41.5% from the year-earlier period due to lower Diners Club and Network Partners revenues.Payment Services volume was up 6% from the prior-year period.PULSE dollar volume expanded 10% year over year, fuelled by higher average spend per transaction related to the pandemic.Diners Club volume contracted 28% from the year-earlier quarter due to the COVID-19 impact.Network Partners volume expanded 23%, backed by AribaPay.Strong Financial PositionDiscover Financial’s total assets were worth $112.9 billion as of Dec 31, 2020, down 1% year over year.Total liabilities as of Dec 31, 2020 were $102 billion, flat year over year.Total equity was $10.8 billion on Dec 31, 2020, down 8.2% year over year.Share Repurchase UpdateThe board of directors recently approved a new $1.1-BILLION share repurchase program, which can be terminated at any time. The new plan expires Dec 31, 2021. How Have Estimates Been Moving Since Then?It turns out, fresh estimates have trended upward during the past month. The consensus estimate has shifted 15.76% due to these changes.VGM ScoresCurrently, Discover has a subpar Growth Score of D, however its Momentum Score is doing a lot better with an A. Following the exact same course, the stock was allocated a grade of A on the value side, putting it in the top 20% for this investment strategy.Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.OutlookEstimates have been broadly trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Discover has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Discover Financial Services (DFS): Get Free Report To read this article on Zacks.com click here.