Trump Proposes 10% Interest Rate Cap on Credit Cards
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 5h ago
0mins
Source: NASDAQ.COM
- Interest Rate Cap Proposal: Trump announced plans to implement a 10% cap on credit card interest rates starting January 20, raising concerns that this measure could limit credit card companies' ability to extend credit, thereby affecting market confidence.
- Capital One Stock Decline: Following this announcement, Capital One (COF) shares fell nearly 6.5% as of 12:25 p.m. ET, indicating investor anxiety about future profitability and potential impacts on the company's competitive position in the market.
- Industry Opposition: Most banking industry groups oppose the cap, arguing that it will reduce credit availability and could negatively impact economic growth, particularly given the consumer spending-driven economic landscape.
- Consumer Spending Risks: Analysts suggest that a 10% interest rate cap may limit credit access for lower credit score borrowers, potentially reducing consumer spending and affecting overall economic vitality.
Analyst Views on COF
Wall Street analysts forecast COF stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for COF is 257.94 USD with a low forecast of 218.00 USD and a high forecast of 290.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
18 Analyst Rating
14 Buy
4 Hold
0 Sell
Strong Buy
Current: 249.200
Low
218.00
Averages
257.94
High
290.00
Current: 249.200
Low
218.00
Averages
257.94
High
290.00
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.
