Latest news with #COF
Yahoo
15 hours ago
- Business
- Yahoo
Jim Cramer Hopes Capital One Financial (COF) Stock 'Could Enter the 52-week Hallowed Ground'
We recently published a list of . In this article, we are going to take a look at where Capital One Financial Corporation (NYSE:COF) stands against other stocks that Jim Cramer discusses. While discussing Capital One Financial Corporation (NYSE:COF), Cramer said that it is cheap, and he remarked: 'You know what, I'm hoping that COF, Capital One, which just bought Discover Financial, that it could enter the 52-week hallowed ground. It's cheap. It'll have a gigantic buyback come July… COF, I feel very lonely, but I won't come July.' Capital One Financial(NYSE:COF) offers a wide range of financial services and products, including credit cards, loans, deposit accounts, and online banking. The company also provides solutions in commercial lending, treasury management, and financial advisory. In an episode aired in May, Cramer called it his 'favorite stock.' A smiling face of a customer as they make a deposit at this company's branch. 'Monday also is the first day when Capital One, the credit card bank, trades as one with Discover Financial as the deal is now closed. Now I've been telling people…. that Capital One is my favorite stock right now in the Charitable Trust, even as it just gained almost 20 points this month alone. I think the move is far from over. I expect number bumps and analyst upgrades. You've got to learn the Capital One story.' Overall, COF ranks 9th on our list of stocks that Jim Cramer discusses. While we acknowledge the potential of COF as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock. READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at Insider Monkey. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
15 hours ago
- Business
- Yahoo
Jim Cramer Calls Capital One Financial (COF) a 'Tremendous' Buy
We recently published a list of . In this article, we are going to take a look at where Capital One Financial Corporation's (NYSE:COF) stands against other stocks that Jim Cramer discusses. Talking about deregulation, Cramer noted that Capital One Financial Corporation's (NYSE:COF) merger with Discover Financial Services was possible under the new administration. 'There are many reasons why Trump won in November, inflation, immigration, cultural backlash, but there's one reason why the business community got behind him in a way they never really did in 2016 or 2020, and that's deregulation…[Referring to the Fed's decision to remove Wells Fargo asset cap restriction] This one comes on the heels of the decision by the administration to let Capital One merge with Discover Financial, okay. A smiling face of a customer as they make a deposit at this company's branch. Capital One Financial (NYSE:COF) provides a range of banking and lending products, including credit cards, loans, deposit accounts, and online banking services, while also offering advisory and treasury management solutions. Overall, COF ranks 14th on our list of stocks that Jim Cramer discusses. While we acknowledge the potential of COF as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock. READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at Insider Monkey.
Globe and Mail
3 days ago
- Business
- Globe and Mail
Jefferies Is Doubling Down on Nvidia. Here Are 3 Other Stocks the Firm Loves Now.
Jefferies recently refreshed its 'Franchise Picks' list, and it sees a solid future for Nvidia (NVDA) as next-gen Blackwell chips are causing the company to remain dominant. The Franchise Picks list is Jefferies' tightest collection of 'Buy'-rated ideas. The firm only admits stocks on which its analysts have solid conviction. Alongside Nvidia, Jefferies also sees Capital One Financial (COF), Expand Energy (EXE), and Huntington Bancshares (HBAN) as top picks. These stocks are riding tailwinds from AI compute, consumer credit scale, the energy boom, and the consolidation in the Midwestern banking sector. There's plenty of upside if things go according to plan. Let's dive in. Stock #1: Capital One Financial (COF) Capital One Financial just won regulatory approval for its $35 billion takeover of Discover. The combined entity is now one of the top card issuers. Capital One already posted solid net income that rose 10% year-over-year last quarter. It now expects to redirect a sizable chunk of Discover spend onto its own processing rails, which could lift margins several hundred basis points. Litigation over deposit practices did cost $425 million, but that is lunch money compared with the incremental cash flow from a vertically integrated payments franchise. Jefferies has maintained its 'Buy' rating on this stock and recently adjusted its price target on COF from $200 to $230. The mean price target is at $217.75, and Jefferies isn't the only firm that's bullish here. Price targets go up to $264. Stock #2: Expand Energy (EXE) Most investors have never heard of Expand Energy, but Jefferies' energy team loves its business. Expand Energy expects to push production to 7.1 bcf‑equivalent‑per‑day in 2025 and 7.5 bcfed the year after. Management just posted a clean earnings beat and reaffirmed a $2.7 billion capital plan to run 12 rigs. The U.S. LNG build‑out means domestic gas (NGN25) demand could rise 18% annually through the decade, and Expand's acreage sits close to Gulf Coast liquefaction hubs. Jefferies raised its target to $135 from $130. The mean price target here is $127.81, and price targets go up to $170. Stock #2: Huntington Bancshares (HBAN) Regional banks remain unloved, but Huntington Bancshares' credit quality looks rock solid. It trades at just under 11 times forward earnings and has a dividend yield of 3.86%. It posted Q1 net income that rose 26% year-over-year, and has had 5% loan growth. It reiterated a 5% to 7% loan and a 3% to 5% deposit CAGR through 2025. The Midwest economy is stronger than coastal investors believe. Manufacturing reshoring is happening, and Huntington sits at the heart of it. It lends to small and midsize firms that are busy rebuilding supply chains. Jefferies initiated coverage last month and set a price target of $20. The mean price target here is $17.65, and Jefferies has the highest price target here among 21 analysts.
Yahoo
28-05-2025
- Business
- Yahoo
COF Stock Tanks 5.9% Post Discover Merger: A Good Buying Opportunity?
Shares of Capital One Financial Corporation COF have lost 5.9% since the completion of the acquisition of Discover Financial Services on May 18. The $35-billion deal reshapes the landscape of the credit card industry, creating a behemoth (in terms of loan volume).Under the terms of the agreement, Discover Financial shareholders received 1.0192 Capital One shares for each Discover Financial share. Now, the company is well-positioned to capture a bigger share of spending on cards and compete with well-known card issuers. Also, it now has control of Discover's payments network—one of only four in the United States. This will enable it to generate greater revenues from interchange fees and offer independence from the Visa-Mastercard the time of the announcement (February 2024), it was noted that the Capital One-Discover merger will likely deliver attractive accretion and returns for shareholders. Expense synergies of $1.5 billion in 2027, coupled with network synergies of $1.2 billion, underscore the value-creation potential of the merger. The transaction will result in a more than 15% accretion to adjusted non-GAAP EPS by the years, COF has pursued a strategic acquisition strategy to diversify its offerings and expand its market presence. Some of the notable ones are ING Direct USA, HSBC's U.S. Credit Card Portfolio and TripleTree. These acquisitions have been instrumental in transforming the company from a monoline credit card issuer into a diversified financial services firm with a significant presence in retail banking, commercial lending and digital banking is this a good time to capitalize on the dip and add Capital One stock to your portfolio? Let's find out. Relatively Higher Rates: The Federal Reserve has kept interest rates unchanged because of tariff policy concerns. This will likely support COF's net interest income ('NII') and net interest margin ('NIM'). Capital One's NII recorded a compound annual growth rate (CAGR) of 6% over the five years ended 2024. Also, NIM expanded to 6.88% in 2024 from 6.63% in 2023. The momentum continued for NII and NIM in the first quarter of 2025. Though the company's revenues declined marginally in 2020, the metric witnessed a five-year (2019-2024) CAGR of 6.5%. In the same time frame, net loans held for investment recorded a CAGR of 4.3%. The uptrend continued for revenues and loans during the first three months of 2025. Quarterly Revenue Trend Image Source: Zacks Investment Research Rising demand for credit card loans and online banking businesses will aid both NII and NIM. Additionally, Capital One plans to continue to offer Discover credit card products as Discover-branded cards as well as the other consumer cards currently offered by Capital One. This will solidify its presence in an intensely competitive environment. COF has been demonstrating an improvement in the Domestic Credit Card division, which accounted for 95.6% of Credit Card net revenues in the first quarter of Capital One's "Digital First" banking model, characterized by its iconic customer experience and fee-free offerings, will be bolstered by Discover Financial's national direct savings bank. This synergy will increase the combined company's ability to compete with the nation's largest banks while accelerating national banking growth. Sales Estimates Image Source: Zacks Investment Research Solid Balance Sheet: As of March 31, 2025, Capital One had a total debt (securitized debt obligations plus other debt) of $41.8 billion. The total cash and cash equivalents balance was $48.6 the company maintains investment-grade long-term senior debt ratings of Baa1, BBB, and A- from Moody's Investor Service, the Standard and Poor's and Fitch Ratings, respectively. This renders the company favorable access to the debt market. Thus, given its decent earnings strength and a solid liquidity position, COF will likely be able to address debt obligations in the near term, even if the economic situation as of March 31, 2025, Capital One's common equity tier 1 ratio and the total capital ratio of 13.6% and 17%, respectively, were well above the regulatory requirements. Further, the company has an average liquidity coverage ratio of 152%. Average Liquidity Coverage Ratio Image Source: Capital One Financial Corp. Capital One's focus on maintaining strong capital and balance sheet positions supports its capital distribution July 2021, the company hiked its dividend by 50% to 60 cents per share and has maintained the same level since then. The bank hiked dividends thrice during the last five years, with a dividend payout ratio of 16%. Dividend Yield Image Source: Zacks Investment Research Similarly, its close peer Ally Financial ALLY and OneMain Holdings, Inc. OMF increased their dividends twice and seven times over the past five years, One has a share repurchase plan. As of March 31, 2025, roughly $3.88 billion worth of shares remained available for repurchase under the authorization. Over the past week, the Zacks Consensus Estimate for 2025 earnings of $14.77 has moved down 3.1%, while the same for 2026 earnings has moved 1.4% upward to $18.49 per share. Estimate Revision Trend Image Source: Zacks Investment Research The projected figures imply a rise of 5.8% and 25.2% for 2025 and 2026, respectively. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.) COF stock has risen 35.5%, outperforming its close peers — Ally Financial and OneMain — over the past year. Further, it has outperformed the industry, Zacks Finance Sector and the S&P 500 index over the same time frame. Capital One's One-Year Price Performance Image Source: Zacks Investment Research Capital One is well-positioned to capitalize on the Discover Financial acquisition and expand its presence in the growing credit card market. Its revenue diversification efforts, relatively higher interest rates, and a solid balance sheet will continue to support its financials. Moreover, analysts remain optimistic regarding COF's long-term prospects despite near-term steadily rising expenses are a headwind. The company recorded a five-year CAGR of 6.8% (ended 2024) in non-interest expenses, mainly due to higher marketing costs and inflationary pressures. The uptrend persisted during the first quarter of 2025. Expenses are expected to remain elevated in the near term due to ongoing technological investments, integration of Discover Financial and high inflation. Deteriorating asset quality is another concern. Capital One's provisions and net charge-offs (NCOs) recorded a CAGR of 13.4% and 11.4% over the five years ended 2024. Though the trend reversed for provisions during the first three months of 2025, NCOs continued to rise. Amid a challenging macroeconomic backdrop and the Discover Financial merger, provision and NCOs are likely to remain terms of valuation, COF's price-to-book ratio (P/B) of 1.11X is higher than the industry's 0.71X. Thus, the stock is trading at a premium. This suggests that investors may be paying a higher price relative to the company's expected earnings growth. P/B Ratio Image Source: Zacks Investment Research Meanwhile, its peers Ally Financial and OneMain have a P/B ratio of 0.87X and 1.82X, respectively. This indicates Ally Financial is trading at a discount while OneMain is overvalued relative to Capital Capital One might be allocating capital inefficiently. This is demonstrated by the company's return on equity (ROE) of 9.63% compared with the industry's ROE of 9.78%. ROE Image Source: Zacks Investment Research Thus, investors should watch out for these concerns and also monitor how Capital One integrates the Discover acquisition into its businesses before making any investment decision. Those who already own the stock can hold on to it for robust long-term COF carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. 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 Capital One Financial Corporation (COF) : Free Stock Analysis Report Ally Financial Inc. (ALLY) : Free Stock Analysis Report OneMain Holdings, Inc. (OMF) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
23-05-2025
- Business
- Yahoo
Here's Why Capital One (COF) is a Strong Value Stock
It doesn't matter your age or experience: taking full advantage of the stock market and investing with confidence are common goals for all investors. Achieving those goals is made easier with the Zacks Style Scores, a unique set of guidelines that rates stocks based on popular investing methodologies, namely value, growth, and momentum. The Style Scores can help you narrow down which stocks are better for your portfolio and which ones can beat the market over the long-term. Different than growth or momentum investors, value-focused investors are all about finding good stocks at good prices, and discovering which companies are trading under what their true value is before the broader market catches on. The Value Style Score utilizes ratios like P/E, PEG, Price/Sales, and Price/Cash Flow to help pick out the most attractive and discounted stocks. Headquartered in McLean, VA, Capital One Financial Corporation is primarily focused on consumer and commercial lending as well as deposit origination. Through its banking and non-banking subsidiaries, the company, founded in 1988, provides various financial products and services to consumers, small businesses and commercial clients in the United States. COF boasts a Value Style Score of A and VGM Score of B, and holds a Zacks Rank #3 (Hold) rating. Shares of Capital One are trading at a forward earnings multiple of 12.3X, as well as a PEG Ratio of 1.1, a Price/Cash Flow ratio of 8X, and a Price/Sales ratio of 1.4X. Many value investors pay close attention to a company's earnings as well. For COF, four analysts revised their earnings estimate upwards in the last 60 days, and the Zacks Consensus Estimate has increased $0.02 to $15.25 per share for 2025. Per share COF boasts an average earnings surprise of 11.2%. COF should be on investors' short lists because of its impressive earnings and valuation fundamentals, a good Zacks Rank, and strong Value and VGM Style Scores. 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 Capital One Financial Corporation (COF) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
