COF  Capital One Financial Corporat...

Exchange

NYSE

Sector

Finance

Industry

Major Banks

Market Cap.

40.79B

Vuru Grade

62.47/100

Current Price

$84.96
+0.785 (+0.933%)

Growth Price

$260.25
Undervalued by 206.34%

Stability Price

$111.85
Undervalued by 31.65%

Company Metrics

  • P/E 12.325
  • P/S 2.122
  • P/B 0.851
  • EPS 6.893
  • Cash ROIC 1.00%
  • Cash Ratio -
  • Dividend 1.6 / 1.91%
  • Avg. Vol. 2.48M
  • Shares 480.14M
  • Market Cap. 40.79B

Company Description

Capital One Financial Corporation operates as the bank holding company for the Capital One Bank (USA), National Association and Capital One, National Association, which provide various financial products and services in the United States, Canada, and the United Kingdom. The company offers various non-interest bearing and interest-bearing deposits, including demand deposits, money market deposits, ... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

Capital One upgraded as bet on higher-risk customers looks set to pay off
MarketWatch - 5 hours ago
Capital One Financial Corp. COF, +1.14% was upgrade to buy from neutral at Instinet, which cited a more bullish outlook on the credit card issuer's focus on higher-risk customers.
Capital One Financial Corp. (COF) Upgraded to Buy by Nomura - Chaffey Breeze
Insider Selling: Capital One Financial Corp. (COF) Insider Sells 9429 Shares ... - The Cerbat Gem
Capital One CEO Richard Fairbank saw a drop in pay in 2016
Washington Business Journal - Mar 22, 2017
Capital One Financial Corp. (NYSE: COF) founder and CEO Richard Fairbank earned $16.9 million in total compensation in 2016, down from the $18 million he earned in 2015, according to Securities and Exchange Commission filings.
Capital One Financial Enters Oversold Territory
Nasdaq - Mar 21, 2017
But making Capital One Financial Corp an even more interesting and timely stock to look at, is the fact that in trading on Tuesday, shares of COF entered into oversold territory, changing hands as low as $84.51 per share.
Capital One buys future business incubator building in Shockoe Bottom
Richmond.com - Mar 20, 2017
Cummings and Loving also are working on raising capital for a fund called the Trolley Ventures that will help support startup ventures in central Virginia.
BRIEF-Capital One Financial says Feb domestic credit card net-charge off rate ...
Reuters - Mar 15, 2017
Capital One Financial Corp - Feb domestic credit card net-charge off rate 5.09 percent versus. 4.91 percent in January. * Capital One Financial Corp - Feb auto net-charge off rate 1.62 percent versus. 2.14 percent in January. * Capital One Financial ...
Capital One launches Eno, gender-neutral virtual assistant
Reuters - Mar 10, 2017
NEW YORK Capital One Financial Corp has developed a "chatbot" named Eno, an automated program that can communicate with the bank's customers via text message to give them information on their accounts and help them make credit card payments ...
Capital One Financial Reaches Analyst Target Price
Nasdaq - Mar 2, 2017
In recent trading, shares of Capital One Financial Corp (Symbol: COF) have crossed above the average analyst 12-month target price of $94.88, changing hands for $96.12/share.
Capital One Financial Corp. Analysts Reduce Earnings Estimates for Mammoth ...
Chaffey Breeze - Mar 28, 2017
Mammoth Energy Services logo Mammoth Energy Services Inc (NASDAQ:TUSK) - Capital One Financial Corp. decreased their FY2017 earnings per share (EPS) estimates for Mammoth Energy Services in a report released on Friday.
Mammoth Energy Services Inc - Receive News & Ratings Daily - BBNS
FY2017 Earnings Forecast for Mammoth Energy Services Inc (TUSK) Issued By ... - Community Financial News
Capital One Financial, Morgan Stanley, Methanex
Times of India - 9 hours ago
March 29 (Reuters) - Wall Street securities analysts revised their ratings and price targets on several U.S.-listed companies, including Boeing, Centurylink and Methanex, on Wednesday.
Top Analyst Upgrades and Downgrades: Boeing, Capital One, CenturyLink, Morgan ... - 24/7 Wall St.
Insider Trading Activity Capital One Financial Corp. (NYSE:COF) – Insider Sold ...
Market Exclusive - Mar 9, 2017
John G Finneran Jr , Insider of Capital One Financial Corp. (NYSE:COF) reportedly Sold 9,429 shares of the company's stock at an average price of 93.49 for a total transaction amount of $881,517.21 SEC Form.
Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for COF to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate COF's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

$84.96 Current Price

$260.25 Growth Price (DCF)

Undervalued by 206.34%


Growth Rate Assumed by Market: -500.00%


Future Free Cash Flow Growth Rate: 2.1%


Discount Rate: 15.0%


Show Free Cash Flow numbers

$111.85 Stability Price (EPV)

Undervalued by 31.65%


Discount Rate: 15.0%

$74.14 Book Price

Overvalued by 12.73%


Poor Cash Return on Invested Capital over the past 5 years

COF has been unable to consistently generate sufficient returns from its investments in buildings, projects and equipment. This could be due to poor management, lack of an economic moat or the capital intensive nature of the business.

COF has only created $1.00 of cash for every $100 invested.
Figures in USD. Fiscal year ends in December
20122013201420152016
Free Cash Flow -7.32B 2.91B 1.12B 9.60B 11.08B
divided by
Invested Capital 312.92B 297.05B 308.85B 334.05B 357.03B
Cash ROIC -2.34% 0.98% 0.36% 2.87% 3.10%

Poor Return on Equity over the past 5 years

COF has shown an inability to deliver strong results for shareholders. This could be due to poor management, COF operating in a highly competitive industry, or having a weak business in general.

COF has only generated $8.99 of Earnings for every $100 of Shareholders' Equity.
Figures in USD. Fiscal year ends in December
20122013201420152016
Net Income 3.52B 4.16B 4.43B 4.05B 3.75B
divided by
Stockholders' Equity 40.50B 41.74B 45.05B 47.28B 47.51B
Return on Equity 8.68% 9.96% 9.83% 8.57% 7.89%

Excellent Business Performance over the past 10 years

COF has been able to maintain profitability in good times and bad. This could mean COF has an extremely strong business or has the ability to scale down costs when needed. This should be a fairly resilient business, but double check for future sustainability by looking at its Risk Factors in the Annual Report.

COF has created positive free cash flow for 9 or more of the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Free Cash Flow 13.01B 3.48B 2.57B 7.80B 7.46B -7.32B 2.91B 1.12B 9.60B 11.08B

Weak Balance Sheet

COF's financial position is not ideal. The key is to check whether COF is using debt to fuel its growth and the sustainability of that tendency. Highly capital intensive businesses (see Economic Moat) follow this route, which can deeply impact the future prospects of the business.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Cash - - - - - - - - - -
Current Assets - - - - - - - - - -
Total Assets 150.59B 165.91B 169.65B 197.50B 206.02B 312.92B 297.05B 308.85B 334.05B 357.03B
Current Liabilities - - - - - - - - - -
Total Liabilities 126.30B 139.30B 143.06B 170.96B 176.35B 272.42B 255.30B 263.80B 286.76B 309.52B
Stockholder' Equity 24.29B 26.61B 26.59B 26.54B 29.67B 40.50B 41.74B 45.05B 47.28B 47.51B
Current Ratio - - - - - - - - - -
TL-to-TA 0.84 0.84 0.84 0.87 0.86 0.87 0.86 0.85 0.86 0.87

Consistent Reinvestment of Profits over the past 10 years

COF has consistently retained profits. This may put COF in a strong position to invest for the future, by buying new machinery, investing in R&D or a number of other options. By effectively using these earnings, COF can greatly improve their long-term economic picture.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Retained Earnings 11.27B 10.62B 10.73B 10.41B 13.46B 16.85B 20.40B 23.97B 27.05B 29.77B
Retained Earnings Growth - -5.74% 1.00% -3.00% 29.37% 25.19% 21.07% 17.49% 12.81% 10.06%

Growing Competitive Advantage over the past 10 years

COF has a growing competitive advantage. This could be due to strong branding, the ability to keep costs low, or some other characteristic that is hard to replicate. Look at its future prospects to determine sustainability and whether the economic moat will continue to strengthen.

$14.04 of every $100 of Revenue have been pure profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Net Income 1.57B -46.00M 883.78M 2.74B 3.15B 3.52B 4.16B 4.43B 4.05B 3.75B
divided by
Revenue 14.58B 13.89B 12.98B 16.17B 16.28B 21.40B 22.38B 22.29B 23.41B 25.50B
Net Profit Margin 10.77% -0.33% 6.81% 16.96% 19.33% 16.44% 18.58% 19.87% 17.30% 14.71%

Weak Pricing Power over the past 10 years

COF is likely in a highly competitive industry, due to low barriers to entry. It's because of this, that COF has been unable to raise prices and increase their profitability. This puts them in a poor position if inflation becomes an issue, as they would struggle to pass higher costs onto consumers.

Only $- of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Gross Profit - - - - - - - - - -
divided by
Revenue 14.58B 13.89B 12.98B 16.17B 16.28B 21.40B 22.38B 22.29B 23.41B 25.50B
Gross Margin - - - - - - - - - -

Low Capital Intensity over the past 10 years

COF has consistently used a small portion of their Net Income buying new equipment or investing in new facilities. This indicates that COF may require minimal investment to stay competitive. This leaves them with extra money to spend on growing their business and potentially buying back stock.

17.06% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Capital Expenditure - - 231.62M 340.00M - 560.00M 818.00M 502.00M 532.00M 779.00M
divided by
Net Income 1.57B -46.00M 883.78M 2.74B 3.15B 3.52B 4.16B 4.43B 4.05B 3.75B
Capital Expenditure Ratio - - 26.21% 12.40% - 15.92% 19.67% 11.34% 13.14% 20.77%

Very Strong Dividend History over the past 10 years

COF has consistently distributed a dividend for at least the past 10 years. Such a long dividend history suggests COF is very established in its market and that its dividend distribution is likely to continue for a significant period of time.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Dividend Paid 42.06M 568.26M 318.84M 91.00M 91.00M 126.00M 608.00M 746.00M 974.00M 1.03B
divided by
Shares Outstanding 395.55M 377.67M 431.42M 456.00M 459.00M 561.00M 587.60M 563.10M 548.00M 509.80M
Dividend Paid Per Share 0.11 1.50 0.74 0.20 0.20 0.22 1.03 1.32 1.78 2.01
Price at Year End 43.21 29.58 37.85 42.24 42.25 57.10 75.82 83.31 73.21 87.24
Dividend Yield 0.25% 5.09% 1.95% 0.47% 0.47% 0.39% 1.36% 1.59% 2.43% 2.31%

History of Stock Buybacks over the past 10 years

COF has some history of delivering increased value for shareholders in the form of stock buybacks. These have helped improve financial metrics and increase each shareholders' relative ownership stake in the company, due to fewer shares outstanding and holding the same number of shares.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Shares Outstanding 395.55M 377.67M 431.42M 456.00M 459.00M 561.00M 587.60M 563.10M 548.00M 509.80M
Stock Bought Back - 4.74% -12.46% -5.39% -0.65% -18.18% -4.53% 4.35% 2.76% 7.49%
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