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Capital One Financial (COF)
NYSE:COF
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Capital One Financial (COF) AI Stock Analysis

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COF

Capital One Financial

(NYSE:COF)

Rating:74Outperform
Price Target:
$246.00
â–²(15.05%Upside)
Capital One Financial's overall score reflects strong financial performance and technical momentum, slightly offset by valuation concerns and challenges from the Discover acquisition. Despite short-term financial impacts, the strategic acquisition positions Capital One for future growth, supported by robust cash flow and improving credit metrics.
Positive Factors
Credit Performance
Capital One's credit improvement metrics are strong, with notable improvements in net charge-offs and delinquencies.
Earnings
COF shares are up 3% as of this writing, following 2Q25 adjusted EPS that beat consensus by 30%.
Shareholder Returns
Capital One repurchasing 10% of its shares annually through 2027 could enhance shareholder value.
Negative Factors
Capital Targets
Bears may point to no capital targets yet, with integration costs 'somewhat higher' versus initial expectations.
Integration Costs
Integration expenses for the Discover acquisition will be higher than previously guided, which is a disappointment.

Capital One Financial (COF) vs. SPDR S&P 500 ETF (SPY)

Capital One Financial Business Overview & Revenue Model

Company DescriptionCapital One Financial Corporation operates as the financial services holding company for the Capital One Bank (USA), National Association; and Capital One, National Association, which provides various financial products and services in the United States, Canada, and the United Kingdom. It operates through three segments: Credit Card, Consumer Banking, and Commercial Banking. The company accepts checking accounts, money market deposits, negotiable order of withdrawals, savings deposits, and time deposits. Its loan products include credit card loans; auto and retail banking loans; and commercial and multifamily real estate, and commercial and industrial loans. The company also offers credit and debit card products; online direct banking services; and treasury management and depository services. It serves consumers, small businesses, and commercial clients through digital channels, branches, cafés, and other distribution channels located in New York, Louisiana, Texas, Maryland, Virginia, New Jersey, and California. Capital One Financial Corporation was founded in 1988 and is headquartered in McLean, Virginia.
How the Company Makes MoneyCapital One generates revenue primarily through interest income from its credit card and loan products, which includes credit card loans, auto loans, and other consumer loans. Interest income is earned on the outstanding balances of these loans. The company also earns money through non-interest income, which includes fees from interchange, annual fees on credit cards, and service charges on deposit accounts. Additionally, Capital One benefits from strategic partnerships and co-branded card agreements with various retailers and organizations, enhancing its customer base and revenue potential. Factors such as credit risk management, economic conditions, and regulatory changes significantly impact its earnings.

Capital One Financial Key Performance Indicators (KPIs)

Any
Any
Total Assets
Total Assets
Shows the total value of assets owned by the company, providing insight into its financial strength, investment capacity, and potential for generating future income.
Chart InsightsCapital One's total assets have shown consistent growth, reaching nearly $494 billion by Q1 2025. This trend reflects strategic expansions, including the Discover acquisition, expected to enhance their consumer banking platform. Despite a slight dip in Q2 2024, asset growth resumed, supported by strong liquidity and capital positions. The earnings call highlighted improved credit metrics and a robust domestic card business, although challenges in revenue and commercial banking persist. The strategic focus on acquisitions and credit performance improvements positions Capital One for continued asset growth.
Data provided by:Main Street Data

Capital One Financial Earnings Call Summary

Earnings Call Date:Jul 22, 2025
(Q2-2025)
|
% Change Since: -1.66%|
Next Earnings Date:Oct 23, 2025
Earnings Call Sentiment Neutral
The earnings call highlights the successful completion and initial benefits of the Discover acquisition, including revenue growth and improving credit metrics. However, it also notes significant challenges such as the net loss from acquisition-related adjustments, higher-than-expected integration costs, and increased provisions for credit losses. While growth prospects remain positive, the immediate financial impact of the acquisition has been negative.
Q2-2025 Updates
Positive Updates
Completion of Discover Acquisition
Capital One successfully completed the acquisition of Discover on May 18, 2025. The integration is progressing well, with Discover's business lines incorporated into Capital One's segments. The acquisition contributed $2 billion of revenue in the partial quarter.
Revenue and Earnings Growth
Revenue in the second quarter increased by $2.5 billion or 25% compared to the first quarter. Adjusted revenue increased by 26%. Pre-provision earnings were up 34% relative to the first quarter, with an adjusted increase of 40%.
Credit Performance Improvement
The domestic card net charge-off rate was 5.25%, down 80 basis points from the prior year quarter. The 30-plus delinquency rate was 3.60%, down 54 basis points from the prior year.
Strong Consumer Banking Growth
Consumer banking ending loan balances increased by $5.6 billion or about 7% year-over-year. Ending consumer deposits grew by 36% driven largely by the addition of Discover deposits.
Negative Updates
Net Loss Due to Discover Acquisition
On a GAAP basis, Capital One reported a net loss of $4.3 billion or a loss of $8.58 per diluted common share due to adjusting items related to the Discover acquisition.
Higher Integration Costs
Integration costs for the Discover acquisition are expected to be somewhat higher than the previously announced $2.8 billion.
Increased Provision for Credit Losses
The provision for credit losses was $11.4 billion in the quarter, mainly due to the $8.8 billion initial allowance build for Discover.
Muted Growth in Discover's Portfolio
Growth in Discover's loan and purchase volume was muted due to previous originations pullbacks and elevated credit losses.
Company Guidance
During the Capital One second quarter 2025 earnings call, several key metrics were highlighted. The company completed its acquisition of Discover on May 18, which led to the integration of $98.3 billion in domestic card loans and $106.7 billion in deposits, among other assets. This acquisition increased Capital One's net loss to $4.3 billion or $8.58 per diluted share, primarily due to an $8.8 billion allowance for credit losses and a $6.4 billion net loss from Discover's partial quarter impact. Revenue for the quarter rose by $2.5 billion, a 25% increase from the prior quarter, driven by the Discover acquisition and strong legacy Capital One results. Net interest margin (NIM) improved by 69 basis points to 7.62%, with a 40 basis point contribution from Discover. Credit card purchase volume grew by 22% year-over-year, including $26.5 billion from Discover, while credit card revenue margin was 17.3%, including Discover's partial quarter impact. Overall, Capital One is on track to achieve $2.5 billion in synergies from the acquisition, with integration costs expected to exceed the initial $2.8 billion estimate.

Capital One Financial Financial Statement Overview

Summary
Capital One Financial shows strong revenue growth and efficient cash flow management. The company maintains a stable leverage position, though profitability and ROE can be improved. Overall, the financial health is solid, but attention to cost management and maximizing returns could further enhance performance.
Income Statement
75
Positive
Capital One Financial demonstrates strong revenue growth with a notable increase from $28.4B in 2022 to $54.3B TTM. The gross profit margin is robust at 52.2%, but the net profit margin is moderate at 9.0%, indicating room for improvement in cost management. EBIT and EBITDA margins suggest operational efficiency, though a slight decline in EBIT margin compared to previous periods could be a concern.
Balance Sheet
70
Positive
The balance sheet shows a solid equity position with a debt-to-equity ratio of 0.66, reflecting a balanced approach to leveraging. Return on Equity is healthy at 7.7%, although slightly lower than desired for maximizing shareholder value. The equity ratio at 12.9% indicates a reasonable level of financial stability, though there could be potential risks if the market conditions change.
Cash Flow
78
Positive
Operating cash flow is strong at $19.8B TTM with a significant free cash flow of $18.5B, highlighting effective cash generation. The free cash flow to net income ratio is high, indicating that the company efficiently converts earnings into cash. The operating cash flow to net income ratio is also favorable, suggesting strong cash earnings quality.
BreakdownDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue53.94B36.79B28.40B30.43B31.64B
Gross Profit27.40B25.77B28.40B30.43B18.26B
EBITDA9.15B9.27B12.45B19.29B6.70B
Net Income4.75B4.89B7.36B12.39B2.71B
Balance Sheet
Total Assets490.14B478.46B455.25B432.38B421.60B
Cash, Cash Equivalents and Short-Term Investments47.08B43.30B107.78B117.01B140.95B
Total Debt45.55B49.32B47.83B42.27B39.87B
Total Liabilities429.36B420.38B402.67B371.35B361.40B
Stockholders Equity60.78B58.09B52.58B61.03B60.20B
Cash Flow
Free Cash Flow16.95B19.61B12.88B11.61B15.99B
Operating Cash Flow18.16B20.57B13.81B12.31B16.70B
Investing Cash Flow-26.41B-21.92B-29.74B-31.50B-14.84B
Financing Cash Flow8.17B13.84B25.13B474.00M25.16B

Capital One Financial Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price213.82
Price Trends
50DMA
205.05
Positive
100DMA
189.98
Positive
200DMA
186.40
Positive
Market Momentum
MACD
2.48
Positive
RSI
52.32
Neutral
STOCH
20.33
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For COF, the sentiment is Neutral. The current price of 213.82 is below the 20-day moving average (MA) of 217.16, above the 50-day MA of 205.05, and above the 200-day MA of 186.40, indicating a neutral trend. The MACD of 2.48 indicates Positive momentum. The RSI at 52.32 is Neutral, neither overbought nor oversold. The STOCH value of 20.33 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for COF.

Capital One Financial Risk Analysis

Capital One Financial disclosed 31 risk factors in its most recent earnings report. Capital One Financial reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks

Capital One Financial Peers Comparison

Overall Rating
UnderperformOutperform
Sector (67)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
78
Outperform
$216.24B21.8232.58%0.99%8.03%6.26%
78
Outperform
$50.34B10.6928.29%1.40%9.42%128.55%
77
Outperform
$27.11B8.8520.23%1.47%-3.16%14.60%
74
Outperform
$137.10B17.987.90%1.12%6.98%-6.76%
71
Outperform
$7.04B10.7020.47%7.14%9.41%13.98%
68
Neutral
$11.92B28.533.84%3.12%-2.99%-43.64%
67
Neutral
$17.09B11.289.28%3.81%11.08%-4.02%
* Financial Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
COF
Capital One Financial
213.82
64.50
43.20%
AXP
American Express
308.54
58.22
23.26%
DFS
Discover Financial Services
200.05
57.89
40.72%
ALLY
Ally Financial
38.51
-5.48
-12.46%
SYF
Synchrony Financial
71.30
21.48
43.12%
OMF
OneMain Holdings
58.29
10.10
20.96%

Capital One Financial Corporate Events

M&A TransactionsFinancial Disclosures
Capital One Reports Decrease in Charge-Offs Post-Acquisition
Positive
Jul 22, 2025

In June 2025, Capital One Financial Corporation reported its monthly charge-off and delinquency metrics, highlighting a decrease in net charge-offs due to its acquisition of Discover Financial Services. The acquisition led to a reduction in net charge-offs by approximately $39 million and adjusted the net charge-off rates for Discover Domestic and Total Domestic Card. Additionally, the alignment of calculation methodologies between Capital One and Discover resulted in a decrease in the 30+ day performing delinquency rates for June.

The most recent analyst rating on (COF) stock is a Buy with a $200.00 price target. To see the full list of analyst forecasts on Capital One Financial stock, see the COF Stock Forecast page.

Regulatory Filings and Compliance
Capital One Announces New Stress Capital Buffer Requirement
Neutral
Jul 1, 2025

On July 1, 2025, Capital One Financial Corporation announced its preliminary Stress Capital Buffer Requirement (SCB) of 4.5 percent, effective October 1, 2025, as determined by the Federal Reserve’s 2025 Comprehensive Capital Analysis and Review process. This new SCB will replace the current 5.5 percent SCB, which remains in effect until September 30, 2025. The Federal Reserve proposed a rule change in April 2025 to average stress test results over two years for SCB calculation, but this has not yet been finalized, and the current SCB reflects the existing framework.

The most recent analyst rating on (COF) stock is a Buy with a $230.00 price target. To see the full list of analyst forecasts on Capital One Financial stock, see the COF Stock Forecast page.

Delistings and Listing ChangesRegulatory Filings and Compliance
Capital One Eliminates Series P Preferred Stock
Neutral
Jun 30, 2025

On June 30, 2025, Capital One Financial Corporation eliminated its 6.125% Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series P, by filing a Certificate of Elimination with the Delaware Secretary of State. This move, which involved redeeming all outstanding shares of the Series P Preferred Stock, impacts the company’s capital structure by reverting these shares to authorized but undesignated status.

The most recent analyst rating on (COF) stock is a Buy with a $200.00 price target. To see the full list of analyst forecasts on Capital One Financial stock, see the COF Stock Forecast page.

DividendsBusiness Operations and Strategy
Capital One Announces Redemption of Series P Stock
Neutral
Jun 25, 2025

On June 25, 2025, Capital One Financial Corporation announced the full redemption of its 6.125% Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series P, and the corresponding depositary shares. This redemption will occur on June 30, 2025, at a price of $1,000 per depositary share, plus accrued but unpaid dividends. This move will cease all dividend accruals on the Series P Preferred Stock after the redemption date, impacting the company’s financial obligations and potentially influencing its market positioning.

The most recent analyst rating on (COF) stock is a Buy with a $200.00 price target. To see the full list of analyst forecasts on Capital One Financial stock, see the COF Stock Forecast page.

Other
Capital One Financial to Participate in Morgan Stanley Conference
Neutral
Jun 9, 2025

Capital One Financial Corporation announced its participation in the Morgan Stanley US Financials, Payments & CRE conference in New York on June 10, 2025. The event will feature a live audio webcast accessible through the company’s website, with the presentation replay available until June 24, 2025, highlighting the company’s commitment to transparency and investor engagement.

The most recent analyst rating on (COF) stock is a Buy with a $200.00 price target. To see the full list of analyst forecasts on Capital One Financial stock, see the COF Stock Forecast page.

Executive/Board ChangesBusiness Operations and Strategy
Capital One Awards RSUs to CEO and Executives
Positive
Jun 5, 2025

On June 3, 2025, Capital One Financial‘s Compensation Committee and independent Board members approved one-time Restricted Stock Units awards for CEO Richard D. Fairbank and other executives to recognize their efforts in integrating the Discover business with Capital One. Fairbank received 153,351 RSUs valued at approximately $30 million, vesting in 2030, while other executives received varying amounts of RSUs vesting in 2028, reflecting the company’s strategic focus on leadership retention and integration success.

The most recent analyst rating on (COF) stock is a Buy with a $245.00 price target. To see the full list of analyst forecasts on Capital One Financial stock, see the COF Stock Forecast page.

M&A TransactionsBusiness Operations and Strategy
Capital One Completes Acquisition of Discover Financial
Positive
May 19, 2025

On May 18, 2025, Capital One Financial Corporation completed its acquisition of Discover Financial Services, following a merger agreement announced on February 19, 2024. This strategic acquisition, approved by regulatory bodies and shareholders, aims to enhance Capital One’s offerings by integrating Discover’s networks and products, including Discover-branded credit cards. The merger involved significant stock and cash transactions, with Capital One assuming Discover’s financial obligations and expanding its board of directors to include former Discover directors. The transaction is expected to strengthen Capital One’s market position and drive innovation in financial services, while maintaining current customer accounts and banking relationships.

The most recent analyst rating on (COF) stock is a Buy with a $200.00 price target. To see the full list of analyst forecasts on Capital One Financial stock, see the COF Stock Forecast page.

Financial Disclosures
Capital One Releases April 2025 Financial Metrics
Neutral
May 15, 2025

Capital One Financial Corporation released its Monthly Charge-Off and Delinquency Metrics for April 2025, highlighting key financial indicators for its credit card and consumer banking segments. The report shows a net charge-off rate of 5.66% for domestic credit cards and 1.01% for auto loans, with delinquency rates of 3.95% and 4.86% respectively, indicating the company’s ongoing management of credit risk and loan performance.

The most recent analyst rating on (COF) stock is a Buy with a $200.00 price target. To see the full list of analyst forecasts on Capital One Financial stock, see the COF Stock Forecast page.

Executive/Board ChangesShareholder Meetings
Capital One Financial Holds Annual Stockholder Meeting
Neutral
May 8, 2025

On May 8, 2025, Capital One Financial Corporation held its Annual Stockholder Meeting where stockholders elected several directors to the board, approved executive compensation, and ratified Ernst & Young LLP as the accounting firm for 2025. A shareholder proposal regarding golden parachute arrangements did not receive majority support, indicating a lack of consensus among stockholders on this issue.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 24, 2025