COF
Capital One Financial Corporation$187.71
Hold
Target $207.90
Report: Mar 09, 2026Financial Services • Financial - Credit Services • Cyclical OperatorSnapshot
Decision-first overview with recommendation, valuation anchor, and current setup.
Company Overview
Research Snapshot
Price History
Pelican View
Current$187.71+10.8%
Rec: HoldConviction: Medium
Entry Target
$159.92
(15% below current)
Fair Value
$207.90
(11% above current)
Stop Loss
$140.00
(25% below current)
Position Size
Starter
Time Horizon
Transitional
Key Metrics
Live Snapshot
Market Data
52 Week High$259.64
52 Week Low$143.22
Avg. 3 Month Volume5.63M
Efficiency
LTM Gross Margin100.0%
LTM EBITDA Margin24.1%
LTM EBIT Margin8.1%
LTM Operating Margin7.0%
LTM ROA0.4%
LTM ROE2.2%
LTM ROIC0.5%
LTM ROCE0.4%
Capital Structure
Market Cap (MM)$113.5B
Enterprise Value (MM)$107.0B
Shares Outstanding621.93M
Total Debt (MM)$51.00B
Cash & Equivalents (MM)$57.43B
LTM Net Debt (MM)$-6.43B
LTM Net Debt/EBITDA-0.8x
Growth
TTM Rev. Growth19.6%
Last 3-Yr Rev. CAGR4.9%
Last 3-Yr EBITDA CAGR-14.0%
Last 3-Yr EPS CAGR-41.9%
Valuation
Street Target Price$275.50
LTM EV/Revenue3.3x
LTM EV/Gross Profit3.3x
LTM EV/EBIT40.4x
LTM EV/EBITDA13.5x
LTM P/E52.0x
LTM EV/FCF4.1x
LTM P/FCF4.3x
LTM P/TB0.2x
LTM P/B1.0x
Dividend Yield1.1%
Payout Ratio57.0%
Executive SummarySituation: Current price is $187.71 versus fair value $207.9 (10.8% expected return), and valuation confidence is stable. Debate: Bull case depends on Credit Card Migration to Discover Network This event validates the core synergy thesis by allowing Capital One to capture network fees and prove the scalability of the Discover infrastructure. Bear case centers on Integration Cost Overruns and Margin Pressure Continued expansion of SG&A beyond the current 78.4% of revenue would prevent the mean reversion to 15% margins required for the base case valuation. Conclusion: Recommendation is Hold with Starter sizing and Transitional horizon.
Bull Case
The successful integration of the Discover network will unlock $2.7 billion in annual synergies and allow Capital One to capture high-margin network fees. Ownership of a global payments network provides a structural cost advantage and a platform for national digital banking expansion.
Bear Case
Integration overruns and sustained SG&A pressure could lead to a prolonged margin trough below the 15% mid-cycle target. Rising consumer credit stress, evidenced by a 5.01% charge-off rate, may require further allowance builds that impair earnings.
Key Catalysts
Mid-Term (6-18 months)Impact: Critical
Credit Card Migration to Discover Network This event validates the core synergy thesis by allowing Capital One to capture network fees and p...
Long-Term (18+ months)Impact: High
Realization of Discover Synergies Achieving the $2.7 billion annual synergy target would address market concerns regarding integration cost...
Long-Term (18+ months)Impact: Moderate
Capital One is relevant for analysis now because the stock is trading at a 1.0x Price-to-Book multiple, a historical trough level, while the...
Primary Risks
Concern: Medium
Integration Cost Overruns and Margin Pressure Continued expansion of SG&A beyond the current 78.4% of revenue would prevent the mean reversi...
Concern: High
Rising Credit Losses and Macro Downturn A 'lower-for-longer' cyclical downturn could drive charge-offs above the current 5.01%, requiring ma...
Concern: Medium
The stewardship verdict is mixed. While the board possesses deep industry expertise, including former CEOs of major card and banking entitie...
Recent Activity
2026-01-23SEC Filing (8-K)
-7.56%Capital One reported monthly credit card and auto loan charge-off and delinquency metrics for December 2025.
2024-10-25SEC Filing (8-K)
+5.23%Capital One reported Q3 2024 net income of $1.8 billion ($4.41 per share).
2023-10-27SEC Filing (8-K)
+9.19%Capital One reported Q3 2023 net income of $1.8 billion ($4.45 per share).
2023-01-25SEC Filing (8-K)
+8.99%Capital One reported Q4 2022 net income of $1.2 billion ($3.03 per share).
2022-11-15SEC Filing (8-K)
-7.18%Capital One reported monthly credit card and auto loan charge-off and delinquency metrics for October 2022.
Valuation Table
9.8/10Decision Grade
Scenario Range
$0
Bear
$3
Base
$346
Bull
$188