UBS Downgrades Capital One Financial (COF) to Neutral

UBS analyst Eric Wasserstrom downgraded Capital One Financial (NYSE: COF) from Buy to Neutral with a price target of $108.00.

The analyst comments "First, we believe our thesis, which revolved around our expectation of improving operating efficiency, has become more fully reflected in consensus forecasts, causing our estimates to converge on consensus levels. For example, while our revised 2020E opex forecasts are lower than consensus by ~$400M, they trail 2021E consensus by less than ~$60M. Similarly, our 2020E EPS is slightly above consensus, but in line for 2021E. As a result, we no longer view improving expectations of operating efficiency as a driver of EPS upside. And second, we view the valuation, which is approaching ~9x 2020E EPS, as nearing fair value, since this level approximates the shares' historical median valuation."

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 $101.08 yesterday.

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