Capital One Financial (NYSE:COF) Issues Earnings Results, Beats Expectations By $1.19 EPS

Capital One Financial (NYSE:COF) posted its quarterly earnings results on Tuesday. The financial services provider reported $6.69 earnings per share for the quarter, beating analysts’ consensus estimates of $5.50 by $1.19, FiscalAI reports. The company had revenue of $16.31 billion for the quarter, compared to the consensus estimate of $16.25 billion. Capital One Financial had a return on equity of 11.28% and a net margin of 13.37%.

Capital One Financial Price Performance

Shares of COF traded up $1.82 during trading hours on Tuesday, reaching $201.65. 4,324,945 shares of the company’s stock traded hands, compared to its average volume of 4,630,098. The firm’s 50 day simple moving average is $207.70 and its 200-day simple moving average is $200.51. The stock has a market cap of $123.71 billion, a PE ratio of 12.48, a price-to-earnings-growth ratio of 0.97 and a beta of 1.04. Capital One Financial has a 12 month low of $174.24 and a 12 month high of $259.64. The company has a current ratio of 1.02, a quick ratio of 1.02 and a debt-to-equity ratio of 0.39.

Capital One Financial Dividend Announcement

The company also recently announced a quarterly dividend, which was paid on Tuesday, September 1st. Shareholders of record on Monday, August 17th were paid a $0.80 dividend. The ex-dividend date was Monday, August 17th. This represents a $3.20 annualized dividend and a yield of 1.6%. Capital One Financial’s dividend payout ratio is currently 19.80%.

Key Headlines Impacting Capital One Financial

Here are the key news stories impacting Capital One Financial this week:

• Positive Sentiment: Earnings beat expectations: Capital One reported quarterly EPS of $6.69, well above the $5.50 analyst consensus, while revenue reached $16.31 billion versus expectations of $16.25 billion. Net margin was 13.37% and return on equity was 11.28%. Capital One Financial quarterly earnings press release
• Positive Sentiment: Improving operating trends: Third-quarter net income rose to $3.5 billion from $3.0 billion in the prior quarter. Total non-interest expense declined 2% to $8.9 billion, net interest margin expanded 40 basis points to 8.41%, and loans held for investment increased to $462.5 billion. A $225 million loan-reserve release also helped results. Capital One Q3 net income report
• Neutral Sentiment: Credit and funding considerations: Provision for credit losses fell to $2.9 billion, but net charge-offs remained substantial at $3.1 billion. Deposits declined $3.6 billion to $480.7 billion, partially offsetting the stronger loan growth. Capital One’s common equity Tier 1 ratio remained solid at 13.8%.
• Negative Sentiment: Insider selling: Insiders Lia Dean and Celia Karam sold shares worth approximately $370,000 and $377,000, respectively. Both transactions were made under pre-arranged Rule 10b5-1 plans, reducing the signaling impact, but the sales may still weigh modestly on sentiment. Capital One insider trading report

Insider Activity at Capital One Financial

In other news, insider Ravi Raghu sold 9,726 shares of the business’s stock in a transaction on Friday, July 31st. The shares were sold at an average price of $209.78, for a total transaction of $2,040,320.28. Following the sale, the insider owned 26,328 shares in the company, valued at approximately $5,523,087.84. The trade was a 26.98% decrease in their position. The sale was disclosed in a filing with the SEC, which is accessible through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Michael Zamsky sold 5,473 shares of the stock in a transaction on Monday, August 10th. The shares were sold at an average price of $218.02, for a total value of $1,193,223.46. Following the sale, the insider directly owned 27,992 shares in the company, valued at $6,102,815.84. This trade represents a 16.35% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Insiders have sold 37,664 shares of company stock valued at $7,914,162 over the last three months. Corporate insiders own 0.78% of the company’s stock.

Analyst Ratings Changes

A number of research firms recently issued reports on COF. JPMorgan Chase & Co. decreased their price objective on Capital One Financial from $246.00 to $227.00 and set an “overweight” rating for the company in a report on Monday, October 12th. BMO Capital Markets initiated coverage on shares of Capital One Financial in a research note on Friday, October 9th. They set a “market perform” rating and a $219.00 target price for the company. Deutsche Bank Aktiengesellschaft set a $245.00 price target on Capital One Financial in a research note on Thursday, August 20th. Wall Street Zen downgraded shares of Capital One Financial from a “buy” rating to a “hold” rating in a research report on Sunday, August 2nd. Finally, Weiss Ratings downgraded shares of Capital One Financial from a “buy (b-)” rating to a “hold (c+)” rating in a research report on Tuesday, October 6th. Twenty analysts have rated the stock with a Buy rating and five have issued a Hold rating to the company’s stock. According to MarketBeat.com, Capital One Financial has a consensus rating of “Moderate Buy” and a consensus price target of $255.04.

About Capital One Financial

Capital One Financial Corporation is a diversified financial services company headquartered in McLean, Virginia. Founded in 1994, the company operates as a bank holding company through Capital One, N.A., providing financial products and services to consumers, small businesses and commercial customers.

Capital One is best known for its credit card business, which offers a range of consumer and business cards. Its other activities include consumer banking products such as checking and savings accounts, auto loans and retail banking services, as well as commercial banking services for businesses and institutions.

The company primarily serves customers in the United States through digital channels, branches and other distribution networks.