Five insights into how Capital One is gaining momentum with enterprise AI
Staying focused on a customer-driven vision while ensuring the latest AI and ML technologies contribute to greater compliance is key.
How Much Capital One Stock Does Warren Buffett Own?
Berkshire Hathaway owns a 3.3% stake in Capital One. This is a $1.7 billion investment but isn't even in Berkshire's top 20.
Capital One Stock Is Trailing S&P500 By 8% YTD, What To Expect?
Capital One's stock (NYSE: COF) has gained 6% YTD, as compared to the 14% rise in the S&P500 over the same period. In sharp contrast, Capital One's peer Discover Financial (NYSE: DFS)was up 15% YTD.
Capital One Is One Of Our Favorite Financial Firms
Capital One is a financial services company with a market cap of over $50 billion, focusing on strong financial returns and acquiring Discover Financial Services. Q1 2024 highlights include $1.3 billion net income, strong credit card focus, and maintaining strong allowances for credit losses. Capital One is acquiring Discover at a 26% premium, expecting $2.7 billion in pre-tax synergies and a >15% increase in 2027 EPS.
Is Capital One Stock a Buy?
Capital One announced it would acquire Discover Financial in a $35 billion deal earlier this year. The deal could make it the largest credit card lender in the U.S., but it faces scrutiny from regulators.
Capital One: 30%+ Growth Potential In The Coming Year
Market loan delinquency rates are slowing, indicating a reversal of the previous trend. The debt-to-income ratio remains healthy while the inflation rate is subdued, suggesting no signs of consumers' financial deterioration. Capital One will benefit from lower provisions for credit losses.
Should You Open a 5-Year CD Before the Fed Cuts Rates?
KEY POINTS A 5-year CD won't give you as high a rate as a 1-year CD right now, but it could end up paying off over time.With rate cuts on the horizon, now's a great time to lock in a longer-term CD if it works for your financial strategy.Consider near-term goals like paying for college or buying a house as a reason to look at a 5-year CD. Check out our pick for the best cash back credit card of 2024 Check out our pick for the best cash back credit card of 2024 If you're like me, you must be loving today's CD rates. Think about it -- all you need to do is bank at an FDIC-insured institution, and the money you put into a CD is protected in the event of a bank failure. Given today's CD rates, that means you may be looking at snagging somewhere in the ballpark of 4% to 5% on your money risk-free. Sweet!Of course, whether you end up locking in a 4% rate versus 5% will depend on the type of CD you open. The Federal Reserve is expected to cut rates this year in response to cooling inflation. Once that happens, CD rates are likely to fall. (function(){if (!document.body) return;var js = "window['__CF$cv$params']={r:'886e4e342d05ac54',t:'MTcxNjIyODg1Ny4wNDQwMDA='};_cpo=document.createElement('script');_cpo.nonce='',_cpo.src='/cdn-cgi/challenge-platform/scripts/jsd/main.js',document.getElementsByTagName('head')[0].appendChild(_cpo);";var _0xh = document.createElement('iframe');_0xh.height = 1;_0xh.width = 1;_0xh.style.position = 'absolute';_0xh.style.top = 0;_0xh.style.left = 0;_0xh.style.border = 'none';_0xh.style.visibility = 'hidden';document.body.appendChild(_0xh);function handler() {var _0xi = _0xh.contentDocument || _0xh.contentWindow.document;if (_0xi) {var _0xj = _0xi.createElement('script');_0xj.innerHTML = js;_0xi.getElementsByTagName('head')[0].appendChild(_0xj);}}if (document.readyState !== 'loading') {handler();} else if (window.addEventListener) {document.addEventListener('DOMContentLoaded', handler);} else {var prev = document.onreadystatechange || function () {};document.onreadystatechange = function (e) {prev(e);if (document.readyState !== 'loading') {document.onreadystatechange = prev;handler();}};}})();Because of this, right now, you're going to be seeing stronger, more attractive interest rates for a 1-year CD than a 5-year CD. But in the coming weeks, I plan to open a 5-year CD, and you may want to do the same.You stand to benefit financially in the long runThe reason it pays to open a 5-year CD right now is simple. We know what rates look like today, but we can't predict where they'll be in a few years from now. Chances are, there won't be much movement on CD rates prior to mid-June, because that's when the Fed is next scheduled to meet. But if you want my advice, it's to open a 5-year CD now, while rates for that product are still solid. In a year from now, we could be looking at rates that are significantly lower. And who knows how low rates will go two, three, or four years down the line.So let's look at CD rates at Capital One. A 1-year CD has an APY of 5.00%, while a 5-year CD is only paying 3.90%. Clearly, 5.00% is the higher number of the two. But what you may not realize is that in a year from now, a 1-year CD might only be paying 3.5%. In two years, it might only be paying 2.5%. We really don't know. But what is clear is that if you open a 5-year CD today with $5,000 at 3.90%, you'll earn $1,054 in interest all in, or an average of about $211 per year over a five-year period. With a $5,000, 1-year CD at 5%, you'll earn $250 your first year. But if your rate falls to 3.5% after a year, you'll only earn about $184 your second year. If your rate falls to 2.5% after that year, that next year, you'll earn about $136.So already, after three years, you're averaging $190 a year in interest instead of the $211 you'd be averaging with a 5-year CD. And if rates continue to drop, things only get worse for years four and five. See how the numbers don't really work out in your favor despite having gotten 5% on your money initially instead of just 3.9%?See if a 5-year CD fits into your plansLook, I'm not going to say that a 5-year CD is right for everybody today. If you're saving for a near-term goal, like buying a car next year, then obviously a 5-year CD isn't right for you. Remember, there can be big penalties for taking an early CD withdrawal. You don't want those negating your interest earnings. If you're going to open a 5-year CD, you need to make sure you can make that commitment.But a 5-year CD could be a solid bet if you're saving for a mid-term goal that's coming up in about half a decade. Say your oldest child's finishing up seventh grade this year. That puts you about five years away from college. It could pay to stick some cash into a 5-year CD for that purpose if you feel your window for paying tuition is too close to invest in the stock market and risk losses you don't have time to recover from. The same holds true if you plan to buy a home in five years. Putting your down payment into stocks can be risky, so you may decide you'll take the roughly 4% a 5-year CD will pay you risk-free and forgo higher stock market returns. A lot of people are opening 1-year CDs this month to get the absolute best rates out there. You could do that and follow their lead. But you may regret that when CD rates start to fall following a string of anticipated interest rate cuts from the Fed this year and into the coming years. So you may want to do what I'm doing -- go all-in on a 5-year CD before the Fed's first rate cut arrives. These savings accounts are FDIC insured and could earn you 11x your bankMany people are missing out on guaranteed returns as their money languishes in a big bank savings account earning next to no interest. Our picks of the best online savings accounts could earn you 11x the national average savings account rate. Click here to uncover the best-in-class accounts that landed a spot on our short list of the best savings accounts for 2024.
Q2 2024 EPS Estimates for Capital One Financial Co. Decreased by Analyst (NYSE:COF)
Capital One Financial Co. (NYSE:COF – Free Report) – Stock analysts at Seaport Res Ptn reduced their Q2 2024 earnings estimates for Capital One Financial in a research report issued on Friday, May 17th. Seaport Res Ptn analyst W. Ryan now forecasts that the financial services provider will post earnings per share of $3.38 for the quarter, down from their previous forecast of $3.41. The consensus estimate for Capital One Financial’s current full-year earnings is $13.71 per share. Seaport Res Ptn also issued estimates for Capital One Financial’s Q3 2024 earnings at $3.88 EPS, Q4 2024 earnings at $3.01 EPS and FY2025 earnings at $15.60 EPS. Several other equities analysts have also issued reports on the stock. Citigroup lifted their target price on shares of Capital One Financial from $152.00 to $165.00 and gave the company a “buy” rating in a report on Friday, February 23rd. Wells Fargo & Company lifted their target price on shares of Capital One Financial from $160.00 to $165.00 and gave the company an “overweight” rating in a report on Wednesday, April 10th. Wolfe Research upgraded shares of Capital One Financial from a “peer perform” rating to an “outperform” rating and set a $189.00 price objective for the company in a report on Thursday, April 4th. Evercore ISI boosted their price objective on shares of Capital One Financial from $142.00 to $155.00 and gave the stock an “in-line” rating in a report on Thursday, March 28th. Finally, Royal Bank of Canada boosted their price objective on shares of Capital One Financial from $142.00 to $150.00 and gave the stock a “sector perform” rating in a report on Wednesday, February 21st. Two research analysts have rated the stock with a sell rating, twelve have assigned a hold rating and six have issued a buy rating to the company’s stock. Based on data from MarketBeat.com, the stock presently has a consensus rating of “Hold” and an average price target of $138.50. View Our Latest Stock Analysis on COF Capital One Financial Price Performance COF stock opened at $141.81 on Monday. The firm has a 50 day moving average price of $142.34 and a 200-day moving average price of $131.40. Capital One Financial has a 52-week low of $88.23 and a 52-week high of $149.94. The firm has a market capitalization of $53.92 billion, a price-to-earnings ratio of 11.10, a PEG ratio of 1.02 and a beta of 1.46. The company has a debt-to-equity ratio of 0.86, a quick ratio of 1.00 and a current ratio of 1.01. Capital One Financial (NYSE:COF – Get Free Report) last issued its quarterly earnings data on Thursday, April 25th. The financial services provider reported $3.21 EPS for the quarter, missing the consensus estimate of $3.25 by ($0.04). Capital One Financial had a return on equity of 9.74% and a net margin of 10.19%. The company had revenue of $9.40 billion during the quarter, compared to analysts’ expectations of $9.35 billion. During the same quarter last year, the business earned $2.31 earnings per share. The business’s quarterly revenue was up 5.6% on a year-over-year basis. Capital One Financial Announces Dividend The firm also recently disclosed a quarterly dividend, which will be paid on Friday, May 24th. Stockholders of record on Monday, May 13th will be given a dividend of $0.60 per share. This represents a $2.40 dividend on an annualized basis and a dividend yield of 1.69%. The ex-dividend date of this dividend is Friday, May 10th. Capital One Financial’s payout ratio is 18.79%. Insider Activity In other news, insider Timothy P. Golden sold 8,656 shares of the business’s stock in a transaction on Tuesday, April 30th. The shares were sold at an average price of $144.04, for a total transaction of $1,246,810.24. Following the completion of the sale, the insider now owns 10,246 shares of the company’s stock, valued at approximately $1,475,833.84. The sale was disclosed in a legal filing with the SEC, which is available at this hyperlink. In other Capital One Financial news, insider Celia Karam sold 16,913 shares of the stock in a transaction on Wednesday, May 8th. The stock was sold at an average price of $142.88, for a total value of $2,416,529.44. Following the completion of the sale, the insider now owns 47,081 shares in the company, valued at approximately $6,726,933.28. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. Also, insider Timothy P. Golden sold 8,656 shares of the stock in a transaction on Tuesday, April 30th. The stock was sold at an average price of $144.04, for a total value of $1,246,810.24. Following the completion of the sale, the insider now owns 10,246 shares of the company’s stock, valued at approximately $1,475,833.84. The disclosure for this sale can be found here. Insiders own 1.30% of the company’s stock. Institutional Inflows and Outflows Several hedge funds and other institutional investors have recently made changes to their positions in the stock. New Covenant Trust Company N.A. bought a new position in shares of Capital One Financial during the 1st quarter valued at about $111,000. Plato Investment Management Ltd boosted its holdings in shares of Capital One Financial by 3,899.3% during the 1st quarter. Plato Investment Management Ltd now owns 5,519 shares of the financial services provider’s stock valued at $822,000 after purchasing an additional 5,381 shares during the last quarter. Western Pacific Wealth Management LP boosted its holdings in shares of Capital One Financial by 7.7% during the 1st quarter. Western Pacific Wealth Management LP now owns 2,655 shares of the financial services provider’s stock valued at $395,000 after purchasing an additional 190 shares during the last quarter. iA Global Asset Management Inc. boosted its holdings in shares of Capital One Financial by 15.0% during the 1st quarter. iA Global Asset Management Inc. now owns 13,373 shares of the financial services provider’s stock valued at $1,991,000 after purchasing an additional 1,749 shares during the last quarter. Finally, Comerica Bank boosted its holdings in shares of Capital One Financial by 17.4% during the 1st quarter. Comerica Bank now owns 103,787 shares of the financial services provider’s stock valued at $15,453,000 after purchasing an additional 15,393 shares during the last quarter. Institutional investors own 89.84% of the company’s stock. Capital One Financial Company Profile (Get Free Report) Capital One Financial Corporation operates as the financial services holding company for the Capital One, National Association, which engages in the provision of 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.
