Capital One Shares Jump On 3Q Profit

BOSTON (AP) — Shares of Capital One Financial Corp. surged Friday after analysts raised profit expectations following the credit card issuer's third-quarter earnings, which easily beat Wall Street forecasts.

Analysts said Capital One appears to be in a good position to increase profits despite consumers' continuing difficulties paying bills, and tighter regulation of the industry after Congress' recent passage of the Credit Card Act.

"We now have greater confidence in the company's ability to successfully mitigate the negative effects of the Card Act," said Fox-Pitt Kelton analyst Bill Carcache, who raised his rating of the stock to "Outperform" from "In Line" and boosted his price target to $48 from $38.

Shares of Capital One rose $2.66, or 6.9 percent, to $40.98 in afternoon trading. Earlier in the session, the stock reached as high as $42.85, approaching levels not seen since last October.

After markets closed Thursday, the McLean, Va.-based company reported net income of $425.6 million, or $0.94 per share, compared with net income of $374.1 million, or $1 per share, in the year-ago quarter. Analysts surveyed by Thomson Reuters were expecting an operating profit of $0.14 per share.