Jim Cramer Increases Capital One Holdings
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 hour ago
0mins
Source: CNBC
- Share Increase: Jim Cramer's Charitable Trust purchased 65 shares of Capital One at approximately $193.81, increasing its total holdings to 675 shares and raising its portfolio weight from 2.9% to 3.25%, reflecting confidence in the stock's potential.
- Market Reaction: Oil prices fell about 5% on Monday following a U.S.-Iran agreement to end the war, which is expected to alleviate consumer credit concerns and improve Capital One's stock performance, indicating a positive market outlook for the company.
- Analyst Rating: Baird labeled Capital One as a 'Bullish Fresh Pick,' citing a favorable risk-reward balance at current levels, with shares trading at just over 7 times their 2027 earnings-per-share estimate, representing a significant 30% to 35% discount compared to other credit-sensitive financials, suggesting the stock is undervalued.
- Earnings Flexibility: Baird noted that even in a deteriorating credit environment, Capital One could maintain profitability, estimating earnings of about $18.70 per share despite a 30% increase in credit loss provisions, highlighting the company's financial resilience and capacity for stock repurchases.
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Analyst Views on COF
Wall Street analysts forecast COF stock price to rise
19 Analyst Rating
16 Buy
3 Hold
0 Sell
Strong Buy
Current: 184.730
Low
256.00
Averages
280.42
High
310.00
Current: 184.730
Low
256.00
Averages
280.42
High
310.00
About COF
Capital One Financial Corporation is a diversified financial services holding company with banking and non-banking subsidiaries. The Company offers a broad spectrum of financial products and services to consumers, small businesses and commercial clients through a variety of channels. It operates through three segments: Credit Card, Consumer Banking and Commercial Banking. The Credit Card segment consists of its domestic consumer and small business card lending, and international card businesses in the United Kingdom and Canada. The Consumer Banking segment consists of its deposit gathering and lending activities for consumers and small businesses, and national auto lending. The Commercial Banking segment consists of its lending, deposit gathering, capital markets and treasury management services to commercial real estate and commercial and industrial customers. Its principal operating subsidiary is Capital One, National Association, which offers banking products and financial services.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Share Increase: Jim Cramer's Charitable Trust purchased 65 shares of Capital One at approximately $193.81, increasing its total holdings to 675 shares and raising its portfolio weight from 2.9% to 3.25%, reflecting confidence in the stock's potential.
- Market Reaction: Oil prices fell about 5% on Monday following a U.S.-Iran agreement to end the war, which is expected to alleviate consumer credit concerns and improve Capital One's stock performance, indicating a positive market outlook for the company.
- Analyst Rating: Baird labeled Capital One as a 'Bullish Fresh Pick,' citing a favorable risk-reward balance at current levels, with shares trading at just over 7 times their 2027 earnings-per-share estimate, representing a significant 30% to 35% discount compared to other credit-sensitive financials, suggesting the stock is undervalued.
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- Share Increase: Jim Cramer's Charitable Trust purchased 65 shares of Capital One at approximately $193.81, increasing its total holdings to 675 shares and raising its portfolio weight from 2.9% to 3.25%, reflecting confidence in the stock's potential.
- Market Reaction: Oil prices fell about 5% on Monday following a U.S.-Iran agreement to end the war, which is expected to alleviate consumer credit concerns and improve Capital One's stock performance, indicating a positive market outlook for the company.
- Analyst Rating: Baird labeled Capital One as a 'Bullish Fresh Pick,' citing a favorable risk-reward balance at current levels, with shares trading at just over 7 times their 2027 earnings-per-share estimate, representing a significant 30% to 35% discount compared to other credit-sensitive financials, suggesting the stock is undervalued.
- Earnings Flexibility: Baird noted that even in a deteriorating credit environment, Capital One could maintain profitability, estimating earnings of about $18.70 per share despite a 30% increase in credit loss provisions, highlighting the company's financial resilience and capacity for stock repurchases.
See More
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- Increased Political Pressure: As Trump and the Republican Party intensify pressure on Wall Street banks to abandon what they term 'woke' policies, banks are compelled to rethink longstanding lending and account service policies, which may significantly impact their market positioning and customer relationships.
- High Volume of Complaints and Investigations: The OCC has received approximately 100,000 complaints related to service restrictions from 2020 to 2023, indicating a strong public demand for transparency in banking services, and the detailed inquiries by regulators could result in formal sanctions against some banks.
- Unclear Legal Liability Theory: While the OCC is exploring potential legal liability theories, many of the groups flagged may not be protected under fair lending laws, presenting legal challenges for regulators in holding banks accountable, which could influence future regulatory policies and banking operations.
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- Term and Responsibilities: Johnson's term is set for five years, although directors typically change with each administration, his leadership could significantly influence future consumer financial regulation policies.
- Agency Status: The CFPB has been largely inoperable since Trump's second term began, with acting director Russell Vought managing day-to-day operations, primarily focused on rolling back previous regulatory rules, reflecting a shift towards reduced regulatory oversight.
- Regulatory Controversy: While Johnson has criticized the CFPB's operations, he has not supported shutting it down; instead, he testified in 2023 that with proper structure and management, the CFPB could do great good, suggesting potential reform intentions for the agency's future.
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- Fee Reduction Plan: The new settlement proposes to lower swipe fees by 0.1 percentage points over five years and caps standard consumer rates at 1.25%, which is expected to save merchants $38 billion and enhance their profitability.
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