NEW YORK (TheStreet) -- Shares of Capital One Financial Corp. (COF) are down -0.99% to $78.01 in pre-market trade after the financial services company said it received subpoenas from the New York District Attorney's Office as part of a money laundering investigation.
The request relates to "certain check-casher clients of the commercial-banking business," the company said in a regulatory filing.
TheStreet Ratings team rates CAPITAL ONE FINANCIAL CORP as a Buy with a ratings score of A. TheStreet Ratings Team has this to say about their recommendation:
"We rate CAPITAL ONE FINANCIAL CORP (COF) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its solid stock price performance, increase in net income, largely solid financial position with reasonable debt levels by most measures, attractive valuation levels and growth in earnings per share. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Consumer Finance industry average. The net income increased by 7.8% when compared to the same quarter one year prior, going from $1,108.00 million to $1,194.00 million.
- The debt-to-equity ratio is somewhat low, currently at 0.89, and is less than that of the industry average, implying that there has been a relatively successful effort in the management of debt levels.
- CAPITAL ONE FINANCIAL CORP reported flat earnings per share in the most recent quarter. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, CAPITAL ONE FINANCIAL CORP increased its bottom line by earning $7.31 versus $6.70 in the prior year. This year, the market expects an improvement in earnings ($7.63 versus $7.31).
- You can view the full analysis from the report here: COF Ratings Report