October 24, 2024
Top 10 Stock Capital One Hold Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Capital One – Top 10 Stock in Employee Health Leaders in the United States
Capital One is listed as a top 10 stock on October 24, 2024 in the market index Employee Health US because of its high performance in at least one of the Obermatt investment strategies. As three out of four consolidated Obermatt Ranks exhibit excellent performance, it is a solid investment from a financial fact perspective where only investor sentiment is a reason for caution. Based on the Obermatt 360° View of 43 (43% performer), Obermatt assesses an overall hold recommendation for Capital One on October 24, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Consumer Finance |
| Index | Employee Health US, Diversity USA, S&P 500 |
| Size class | XX-Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View Capital One Hold
| 360 METRICS | October 24, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 53 |
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| GROWTH | ||||||||
| GROWTH | 55 |
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| SAFETY | ||||||||
| SAFETY | 68 |
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| SENTIMENT | ||||||||
| SENTIMENT | 19 |
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| 360° VIEW | ||||||||
| 360° VIEW | 43 |
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ANALYSIS: With an Obermatt 360° View of 43 (better than 43% compared with alternatives), overall professional sentiment and financial characteristics for the stock Capital One are below the industry average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators above average for Capital One. The consolidated Value Rank has an attractive rank of 53, which means that the share price of Capital One is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 53% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 55, which means that the company experiences above-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth, as well as stock returns. The company is also safely financed with a Safety Rank of 68. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of only 19. Professional investors are more confident in 81% other stocks. ...read more
RECOMMENDATION: With a consolidated 360° View of 43, Capital One is worse than 57% of all alternative stock investment opportunities based on the Obermatt Method. As three out of four consolidated Obermatt Ranks exhibit excellent performance, such as good value (Value Rank of 53), above-average growth (Growth Rank of 55), and safe financing practices (Safety Rank of 68), it is a solid stock investment where the risk of paying too much for the shares is limited, and disappointments are less likely, unless information not publicly available. Only the professional market sentiment is on the riskier side (Sentiment Rank of 19), but that could also mean an overreaction to negative news in the past. Good value is sometimes an indication that the company's future is challenging. If they have been enjoying above average growth and are still a good value, this may not continue. We recommend evaluating whether the future of Capital One is as challenging as the low price of the stock despite good growth and safe financing practices suggest. Since the professional community is pessimistic, you may want to reflect these negative opinions in light of what you find reasonable to expect for the future. If you believe this pessimistic view is transitory, you have a solid investment case based on current financial factors. ...read more
Sentiment Strategy: Professional Market Sentiment for Capital One negative
ANALYSIS: With an Obermatt Sentiment Rank of 19 (better than 19% compared with alternatives), overall professional sentiment and engagement for the stock Capital One is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Capital One. Analyst Opinions are at a rank of 46 (worse than 54% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 30 which means that stock research experts are getting even more pessimistic. It doesn't end with the analysts. Market Pulse is also low with a rank of 26, which means that the current professional news and professional social networks are on the negative side when discussing this company (more negative news than for 74% of competitors). No wonder, the Professional Investors rank is only 26, which means that professional investors hold less stock in this company than in 74% of alternative investment opportunities. Pros tend to stay away from Capital One, which may be due to a small company size but just as likely because of its relatively low Sentiment Rank. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 19 (less encouraging than 81% compared with investment alternatives), Capital One has a reputation among professional investors that is far below that of its competitors. Investors should be careful with this stock right now. Further research is required if an investment is desired, because the facts found in the professional community are all negative. ...read more
Value Strategy: Capital One Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 53 (better than 53% compared with alternatives), Capital One shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for Capital One. Price-to-Sales (P/S) is 58, which means that the stock price compared with what market professionals expect for future sales is lower than for 58% of comparable companies, indicating a good value regarding Capital One's revenue size. The same is valid for expected Price to Profits (or Price / Earnings, P/E), more favorable than for 51% of alternatives, and it's also true for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 68. But, compared with other companies in the same industry, dividend yields are expected to be lower than average; only 49% of all competitors have even lower dividend yields than Capital One (a Dividend Yield Rank of 49). 51% alternative investments in the same business provide a higher dividend yield. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 53, is a buy recommendation based on Capital One's stock price compared with the company's operational size and dividend yields. The below-average dividend yield may be a good sign, as it could mean the company has more attractive investment opportunities for the generated cash than to pay it out as dividends. A low dividend yield can also indicate a growth phase. ...read more
Growth Strategy: Capital One Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 55 (better than 55% compared with alternatives), Capital One shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Capital One. Capital Growth has a rank of 73, which means that currently professionals expect the company to grow its invested capital more than 37% of its competitors. Investors welcomed this, visible in the Stock Returns rank of 71 (above 71% of alternative investments). But Sales Growth has only a rank of 33, which means that, currently, professionals expect the company to grow less than 67% of its competitors, and Profit Growth is also low at a rank of 37. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 55, is a buy recommendation for growth and momentum investors. This is an ambiguous picture. Revenue growth and capital growth are strong, but the growth in profit, which seems good, can also be an indication that growth momentum may be negative. The fact that stock returns have been above average doesn't help much, as stock returns are less reliable in showing a company’s future growth potential. Prices may perform well for the simple reason that investors were too pessimistic in the past and are now correcting their opinions and moving the stock price to a more reasonable level. As the growth picture is mixed for Capital One, investors may want to look at value and sentiment indicators for a well-rounded picture of this stock. ...read more
Safety Strategy: Capital One Debt Financing Safety above-average
| SAFETY METRICS | October 24, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 54 |
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| REFINANCING | ||||||||
| REFINANCING | 72 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 19 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 68 |
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ANALYSIS: With an Obermatt Safety Rank of 68 (better than 68% compared with alternatives), the company Capital One has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Capital One is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators where two out of three are above average for Capital One.Leverage is at 54, meaning the company has a below-average debt-to-equity ratio. It has less debt than 54% of its competitors.Refinancing is at a rank of 72, meaning that the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 72% of its competitors. Liquidity is at 19, meaning that the company generates less profit to service its debt than 81% of its competitors. This indicates that the company is on the riskier side regarding debt service. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 68 (better than 68% compared with alternatives), Capital One has a financing structure that is safer than that of its competitors. Low leverage and low refinancing risk mean a safer financing situation. However, low liquidity means that current company cash flows are low in relation to the level of debt. This is a sign of caution in case it is expected for profits to remain low. ...read more
Combined financial peformance: Capital One Top Financial Performance
| COMBINED PERFORMANCE | October 24, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 53 |
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| GROWTH | ||||||||
| GROWTH | 55 |
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| SAFETY | ||||||||
| SAFETY | 19 |
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| COMBINED | ||||||||
| COMBINED | 75 |
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ANALYSIS: With an Obermatt Combined Rank of 75 (better than 75% compared with investment alternatives), Capital One (Consumer Finance, USA) shares have much better financial characteristics than comparable stocks. Shares of Capital One are a good value (attractively priced) with a consolidated Value Rank of 53 (better than 53% of alternatives), show above-average growth (Growth Rank of 55), and are safely financed (Safety Rank of 68), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 75, is a strong buy recommendation based on Capital One's financial characteristics. As the company Capital One's key financial metrics all exhibit excellent performance, such as good value (Obermatt Value Rank of 53), above-average growth (Obermatt Growth Rank of 55), and indicate that the company is safely financed (Obermatt Safety Rank of 68), it is a solid stock investment where the risk of paying too much for the share is limited, unless the company has a bleak future. Such good financial performance can indicate that the company's future might actually be challenging, as it may be difficult to maintain the good performance. If they are safely financed and have been growing above average, and are still a good value, it means that the market is keeping prices low, for a reason which may become clearer over time. We recommend evaluating the future of Capital One. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. ...read more
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