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Capital One (COF) Dips More Than Broader Markets: What You Should Know

Capital One (COF) closed at $105.82 in the latest trading session, marking a -0.95% move from the prior day. This change lagged the S&P 500's daily loss of 0.78%. At the same time, the Dow lost 0.88%, and the tech-heavy Nasdaq lost 0.25%.

Prior to today's trading, shares of the credit card issuer and bank had lost 0.1% over the past month. This has was narrower than the Finance sector's loss of 1.15% and the S&P 500's loss of 3.4% in that time.

Investors will be hoping for strength from Capital One as it approaches its next earnings release. The company is expected to report EPS of $5.15, down 24.93% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $8.58 billion, up 9.59% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $19.99 per share and revenue of $33.73 billion, which would represent changes of -25.83% and +10.82%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for Capital One. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 0.01% lower within the past month. Capital One is currently a Zacks Rank #3 (Hold).

Valuation is also important, so investors should note that Capital One has a Forward P/E ratio of 5.34 right now. Its industry sports an average Forward P/E of 5.62, so we one might conclude that Capital One is trading at a discount comparatively.

Investors should also note that COF has a PEG ratio of 0.31 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. COF's industry had an average PEG ratio of 0.27 as of yesterday's close.

The Financial - Consumer Loans industry is part of the Finance sector. This group has a Zacks Industry Rank of 175, putting it in the bottom 31% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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