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Research Alert: CFRA Lowers Opinion On Shares Of Capital One Financial Corporation To Hold From Buy

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CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:

We lower our 12-month target price by $60 to $205, applying a forward P/E of 8.6x our 2027 EPS estimate, in line with the 10-year historical average of 8.7x. We reduce our 2026 adjusted EPS view to $19.56 from $19.87 and cut our 2027 EPS estimate to $23.74 from $24.46. We lower our outlook on COF primarily due to macroeconomic concerns. The ongoing Middle East conflict is driving inflation above wage growth, pressuring consumer finances. Given COF's significant consumer exposure through its credit card and auto lending businesses, we believe near-term headwinds will largely offset the benefits from its expansion into higher-income segments and operational improvements from the Discover Financial acquisition. Consequently, we now forecast 2026 net charge-offs of approximately 330 bps, up from our previous estimate of 300 bps. Importantly, COF enters this environment from a position of relative strength, with a robust CET1 ratio of 14.4% and a strong allowance coverage ratio of 5.28%.

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