Capital One Stock Is Slightly Overvalued

SectorFinancial Markets
CountryMiddle east

Share to Linkedin Capital One reported total revenues of $7. 1 billion, which was 2% lower than the previous year. This could be attributed to a 3% y-o-y drop in net interest income driven by a drop in outstanding loan balances and a lower interest rate environment, partially offset by a 5% increase in non-interest revenues.

Additionally, COF’s adjusted net income figure increased from -$1. 4 billion to $3. 2 billion on a year-on-year basis, mainly due to a significant drop in provisions for credit losses – it released $1. 6 billion in reserves for loan losses in the quarter. Capital One’s revenue of $28. 5 billion for the full year 2020 was marginally lower than the 2019 figure. The net interest income of all the banks with sizable loan portfolios suffered in 2020 due to a decline in new loan issuance and a lower interest rate environment, and Capital One was no exception. Its NII reduced by 2% y-o-y, more...