Nomura Securities Maintains a 'Buy' on Capital One Financial (COF); Explaining the Lag

Nomura Securities maintains a 'Buy' on Capital One Financial (NYSE: COF) price target of $58.00.

Analyst, Brian Foran, said, "COF has lagged the bank index by 8% over the past five days, its largest underperformance of the year. We review why we like the stock and the key issues that have been weighing on the shares. The new issue hitting COF is unemployment insurance; however we don’t feel it will be a game changer. We see ~$7 of earnings power once ING Direct (NYSE: ING) and HSBC Card (NYSE: HBC) close. The stock trades at 6x that number. Moreover, while cards are competitive, we see opportunity for market share shifts out of debit and home equity, which would be a reversal of the trend over the past decade. Our report earlier this week summarized this thesis."

For an analyst ratings summary and ratings history on Capital One Financial click here. For more ratings news on Capital One Financial click here.

Shares of Capital One Financial closed at $41.75 yesterday.

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