How PayPal Quickly Gets into Mobile Payments in a Big Way

With a $10 billion market cap, Discover Financial Services is ridiculously undervalued, says consultant Philip J. Philliou. "$10 billion is barely fair value for the card portfolio and yet, it is the network that makes DFS most attractive," says Philliou. "My wildcard bet is that PayPal acquires DFS."

In the scenario, PayPal rebrands everything Discover and uses the Discover Network to penetrate the $6 trillion in store spend opportunity in the United States.

2011 Prediction: Discover Financial Services acquired by year end