Capital One Financial Corporation operates as the financial services holding company for the Capital One, National Association, which engages in the provision of various financial products and services in the United States, Canada, and the United Kingdom. It operates through three segments: Credit Card, Consumer Banking, and Commercial Banking. The company accepts checking accounts, money market deposits, negotiable order of withdrawals, savings deposits, and time deposits. Its loan products include credit card loans; auto and retail banking loans; and commercial and multifamily real estate, and commercial and industrial loans. The company also offers credit and debit card products; online direct banking services; and provides advisory, capital markets, treasury management, and depository services. It serves consumers, small businesses, and commercial clients through digital channels, branches, cafés, and other distribution channels located in New York, Louisiana, Texas, Maryland, Virginia, New Jersey, and California. The company was founded in 1988 and is headquartered in McLean, Virginia.

Capital One appears to be a high-quality financial business with noticeably stronger profitability than the average industry player, but without clear signs of deep undervaluation that would justify aggressive upside. P/E of 11.3, P/S of 1.53, P/B of 1.10, and especially P/FCF of 4.04 are below industry medians, supporting the thesis of a fair valuation and limiting the risk of overvaluation. At the same time, ROA of 1.56% is above the median, while ROE of 9.39% and ROI of 6.54% are slightly weaker than the industry, and return on tangible equity of 15.97% already looks strong and confirms good capital efficiency. Profit margin of 13.29% and operating margin of 16.62% are below industry benchmarks, but the year-over-year trend has improved significantly after a weak period, indicating a recovery in business quality. Revenue, operating profit, and net income increased in the latest reporting period, and net income of $3.42 billion and operating income of $4.57 billion confirm sustainable profit generation. The balance sheet overall looks manageable: debt/equity of 0.45 is around the median, current ratio of 1.02 is normal, and long-term debt does not appear excessive given the large asset and capital base. On the other hand, the quick ratio is zero, which is not a critical signal for a bank, but it does remind us of the liquidity specifics of the financial sector and the need to look at balance sheet structure rather than classic industrial metrics. Dividend yield of 0.36% remains very modest, so the dividend factor does not add a strong investment case. Net worth and equity are high in absolute terms, but their trend is more stable than accelerating, which supports the valuation but does not require a significant increase in the target. Overall, the fundamentals support the current forecast more than they justify a meaningful increase: the business is high quality, profitable, and moderately valued, but without a pronounced discount to the industry. Therefore, the target price adjustment should be small and conservative, with a slight reduction due to limited dividend appeal and the absence of a strong re-rating catalyst.

COFFEE-11.26

Capital One Financial Corporation

Сильный индекс, незначительно упал. Быки в растерянности.

Strong index, slightly down. The bulls are confused.

Слабый индекс, значительно вырос. Рынок не поддерживает быков.

Weak index, significantly up. The market does not support the bulls.

Слабый индекс, незначительно вырос

COF appears fundamentally sound: profitability and valuation look attractive, but the dividend yield is low and the revaluation potential is limited.

In trading on Tuesday, shares of Capital One Financial Corp's 4.80% Dep Shares Non-Cumul Perp Pfd Stock Series J (Symbol: COF.PRJ) were yielding above the 7.5% mark based on its quarterly dividend (annualized to $1.20), with shares changing hands as low as $15.80 on the day. This compares to an average yield of 7.05% in the "Financial" preferred stock category, according to Preferred Stock Channel. As of last close, COF.PRJ was trading at a 35.88% discount to its liquidation preference amount, versus the average discount of 16.09% in the "Financial" category. Investors should keep in mind that the shares are not cumulative, meaning that in the event of a missed payment, the company does not have to pay the balance of missed dividends to preferred shareholders before resuming a common dividend.
The chart below shows the one year performance of COF.PRJ shares, versus COF:
Below is a dividend history chart for COF.PRJ, showing historical dividend payments on Capital One Financial Corp's 4.80% Dep Shares Non-Cumul Perp Pfd Stock Series J:
Further COF.PRJ Research:

Capital One Financial's Preferred Stock Series J Shares Cross 7.5% Yield Mark

In trading on Tuesday, shares of Capital One Financial Corp's 4.375% Dep Shares Non-Cumul Perp Pfd Stock Series L (Symbol: COF.PRL) were yielding above the 7.5% mark based on its quarterly dividend (annualized to $1.0938), with shares changing hands as low as $14.56 on the day. This compares to an average yield of 7.05% in the "Financial" preferred stock category, according to Preferred Stock Channel. As of last close, COF.PRL was trading at a 41.00% discount to its liquidation preference amount, versus the average discount of 16.09% in the "Financial" category. Investors should keep in mind that the shares are not cumulative, meaning that in the event of a missed payment, the company does not have to pay the balance of missed dividends to preferred shareholders before resuming a common dividend.
The chart below shows the one year performance of COF.PRL shares, versus COF:
Below is a dividend history chart for COF.PRL, showing historical dividend payments on Capital One Financial Corp's 4.375% Dep Shares Non-Cumul Perp Pfd Stock Series L:
Further COF.PRL Research:

Capital One Financial's Preferred Stock Series L Shares Cross 7.5% Yield Mark

S&P Global Ratings (S&P) upgraded the issuer credit rating of Rithm Capital Corp. RITM to ‘B+’ from ‘B’, while maintaining a stable outlook. S&P also raised the rating on Rithm Capital’s senior unsecured notes to ‘B’ from ‘B-’.
The upgrade reflects RITM's continued efforts to scale and diversify its earnings streams through its asset management, residential transitional lending (RTL) and commercial real estate businesses. Meanwhile, the company's mortgage finance subsidiary, Newrez, has maintained stable earnings despite a challenging macroeconomic environment, supporting the rating action.
Why S&P Upgraded RITM's Rating
Diversification Supports Earnings: Rithm Capital has continued to expand its nonmortgage finance businesses, increasing their contribution to the company’s overall business mix. As of June 30, 2026, asset management, RTLs and commercial real estate accounted for nearly 33% of the company’s stockholders’ equity and total revenues compared with 9% and 13%, respectively, for nonmortgage finance operations at 2022-end.
S&P expects continued growth in these businesses to drive higher contributions from management fees, net interest income and rental revenue. This is expected to reduce RITM’s reliance on mortgage finance operations and further diversify its earnings base.
Expanding Asset Management and RTL Businesses: The company’s asset management platform continued to expand, with assets under management (AUM) reaching approximately $61 billion as of June 30, 2026, up from $34 billion at 2024-end. Growth was supported by the acquisition of Crestline and organic expansion. While the platform’s earnings contribution remains modest due to its high-cost base, S&P expects higher AUM to improve operating leverage and support margin expansion.
Its Genesis platform, acquired in December 2021, also continued to expand its RTL business. The RTL loan portfolio increased to $3.8 billion as of June 30, 2026, from $2.7 billion at 2025-end. The business generated $60 million in pretax income in the first half of 2026, up from $41 million in the prior-year period, reflecting continued demand from institutional sponsors in the single-family and multifamily markets.
Its asset quality also remains stable, with past-due loans accounting for 2.5% of total unpaid principal balance as of June 30, 2026, compared with 3.7% at 2025-end. Going forward, S&P expects Rithm Capital to increasingly use third-party capital to fund originations, allowing the company to expand its asset management platform while reducing capital intensity.
Newrez Provides Stable Earnings: The company’s mortgage finance subsidiary, Newrez, continues to support its earnings profile despite challenging economic conditions. In the first half of 2026, Newrez generated approximately $581 million in pretax income, excluding mortgage servicing rights mark-to-market and hedging results, up 7% from the same period in 2025.
The improvement was driven by higher origination volumes and stable servicing revenue. Although Newrez incurred significant hedging losses in the second quarter of 2026 amid elevated interest-rate volatility, S&P expects some of these losses to reverse in the third quarter.
Looking ahead, high mortgage rates could continue to pressure mortgage origination volumes, particularly in the refinance market, while intensifying competition across the industry. Nevertheless, S&P expects Newrez to maintain relatively stable earnings through the interest-rate cycle, supported by disciplined origination pricing, favorable economics from its low-coupon servicing portfolio and ongoing cost-reduction initiatives.
Healthy Leverage and Liquidity Position: The company’s leverage remains within S&P’s expected range of 4.5X-6.5X on a sustained basis, with the debt-to-adjusted total equity (ATE) ratio at 5.7X as of June 30, 2026, up from 5.4X at 2025-end. The increase was primarily driven by higher asset-backed securities debt as the company expanded its securitization activities.
Meanwhile, liquidity remains adequate, with approximately $1.7 billion of cash and cash equivalents and another $400 million of available committed funding capacity as of June 30, 2026. S&P noted that RITM remains in compliance with its financial covenants and regulatory liquidity and net worth requirements, with adequate cushions. The company also has no unsecured debt maturities until 2029, providing additional funding flexibility.
Factors Influencing Future Ratings of RITM
The stable outlook reflects S&P's expectation that Rithm Capital will continue to increase its scale and business diversification while maintaining stable earnings and adequate liquidity. The agency expects debt to ATE to remain within the 4.5X-6.5X range.
However, rating pressure could emerge if RITM faces difficulty renewing funding facilities, increases its reliance on secured funding, allows debt-to-ATE to rise above 6.5X or shifts toward materially riskier assets. Conversely, an upgrade could become possible if it maintains access to funding, reduces reliance on secured financing, keeps debt-to-ATE below 4.5X and maintains a diversified asset mix, along with stable earnings and adequate liquidity.
RITM’s Price Performance & Zacks Rank
RITM shares have lost 0.7% in the past six months against the industry’s growth of 9.5%.
At present, RITM carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Rating Action on Other Banks
Similar to RITM, in September 2026, S&P Global Ratings also upgraded the long-term issuer credit rating of Capital One Financial Corp. COF to ‘BBB+’ from ‘BBB’, while maintaining a stable outlook. S&P also raised the long-term issuer credit rating of Capital One N.A. to ‘A-’ from ‘BBB+’ and affirmed its short-term issuer credit rating at ‘A-2’.
The upgrade reflects COF’s stronger franchise and progress in integrating Discover. S&P expects the acquisition to support card purchase volumes, fee income and revenue stability, while its auto-lending and corporate finance businesses provide additional diversification.
In the same month, Citizens Financial Group, Inc. CFG announced that Fitch Ratings upgraded its and Citizens Bank N.A.'s long-term issuer default ratings (IDRs) to ‘A-’ from ‘BBB+’, while maintaining a stable outlook. Fitch also upgraded the companies’ viability ratings to ‘a-’ from ‘bbb+’ and affirmed their short-term IDRs at ‘F1’.
The upgrade reflects sustained improvements in earnings and profitability, supported by asset repricing, stable credit costs and growth in fee-generating businesses. Fitch also cited CFG’s diversified business model, strong deposit franchise, adequate capital and stable asset quality.
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RITM's Credit Rating Upgraded to 'B+' by S&P, Outlook Remains Stable

Among the underlying components of the S&P 500 index, we saw noteworthy options trading volume today in Apollo Global Management Inc (new (Symbol: APO), where a total of 23,626 contracts have traded so far, representing approximately 2.4 million underlying shares. That amounts to about 92.7% of APO's average daily trading volume over the past month of 2.5 million shares. Especially high volume was seen for the $120 strike put option expiring January 15, 2027, with 8,016 contracts trading so far today, representing approximately 801,600 underlying shares of APO. Below is a chart showing APO's trailing twelve month trading history, with the $120 strike highlighted in orange:
Coinbase Global Inc (Symbol: COIN) options are showing a volume of 75,228 contracts thus far today. That number of contracts represents approximately 7.5 million underlying shares, working out to a sizeable 74% of COIN's average daily trading volume over the past month, of 10.2 million shares. Particularly high volume was seen for the $210 strike call option expiring September 25, 2026, with 7,805 contracts trading so far today, representing approximately 780,500 underlying shares of COIN. Below is a chart showing COIN's trailing twelve month trading history, with the $210 strike highlighted in orange:
And Capital One Financial Corp (Symbol: COF) options are showing a volume of 25,191 contracts thus far today. That number of contracts represents approximately 2.5 million underlying shares, working out to a sizeable 73% of COF's average daily trading volume over the past month, of 3.5 million shares. Especially high volume was seen for the $210 strike call option expiring October 16, 2026, with 10,014 contracts trading so far today, representing approximately 1.0 million underlying shares of COF. Below is a chart showing COF's trailing twelve month trading history, with the $210 strike highlighted in orange:
For the various different available expirations for APO options, COIN options, or COF options, visit StockOptionsChannel.com.
Further APO Research:

Notable Thursday Option Activity: APO, COIN, COF

Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the Xtrackers S&P 500 Scored & Screened ETF (Symbol: SNPE) where we have detected an approximate $127.1 million dollar outflow -- that's a 4.3% decrease week over week (from 41,650,001 to 39,850,001). Among the largest underlying components of SNPE, in trading today Welltower Inc (Symbol: WELL) is up about 0.6%, Uber Technologies Inc (Symbol: UBER) is down about 0.8%, and Capital One Financial Corp (Symbol: COF) is lower by about 1.1%. For a complete list of holdings, visit the SNPE Holdings page » The chart below shows the one year price performance of SNPE, versus its 200 day moving average:
Looking at the chart above, SNPE's low point in its 52 week range is $57.67 per share, with $72.02 as the 52 week high point — that compares with a last trade of $70.16. Comparing the most recent share price to the 200 day moving average can also be a useful technical analysis technique -- learn more about the 200 day moving average ».
Exchange traded funds (ETFs) trade just like stocks, but instead of ''shares'' investors are actually buying and selling ''units''. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed). Creation of new units will mean the underlying holdings of the ETF need to be purchased, while destruction of units involves selling underlying holdings, so large flows can also impact the individual components held within ETFs.
Further SNPE Research:

SNPE, WELL, UBER, COF: Large Outflows Detected at ETF

(RTTNews) - On Monday, Capital One Canada (COF) announced that it has appointed Becca Mintz as the President.
Mintz brings more than 17 years of operational and strategic experience to the role. She joined Capital One Canada as an analyst in Toronto and later held several leadership positions in customer acquisition, marketing, and card partnerships. Most recently, she served as Managing Vice President and Head of Customer Credit and Data, where she led strategies for many of Capital One Canada's products and services.
Mintz is a recognized leader in Canadian financial services. She was named one of Canada's Top 50 Women Leaders of 2025 by Women We Admire and one of the Top 100 Most Powerful Women by the Women's Executive Network in 2017. She previously served on the Canadian Chamber of Commerce's Council for Women's Advocacy.
On the NYSE, the shares were trading 0.66 percent up at $203.77.

Capital One Canada Appoints Becca Mintz As President

Investors in Capital One Financial Corp (Symbol: COF) saw new options become available today, for the January 2029 expiration. One of the key data points that goes into the price an option buyer is willing to pay, is the time value, so with 858 days until expiration the newly available contracts represent a possible opportunity for sellers of puts or calls to achieve a higher premium than would be available for the contracts with a closer expiration. At Stock Options Channel, our YieldBoost formula has looked up and down the COF options chain for the new January 2029 contracts and identified one put and one call contract of particular interest.
The put contract at the $195.00 strike price has a current bid of $26.50. If an investor was to sell-to-open that put contract, they are committing to purchase the stock at $195.00, but will also collect the premium, putting the cost basis of the shares at $168.50 (before broker commissions). To an investor already interested in purchasing shares of COF, that could represent an attractive alternative to paying $207.81/share today.
Because the $195.00 strike represents an approximate 6% discount to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the put contract would expire worthless. The current analytical data (including greeks and implied greeks) suggest the current odds of that happening are 70%. Stock Options Channel will track those odds over time to see how they change, publishing a chart of those numbers on our website under the contract detail page for this contract. Should the contract expire worthless, the premium would represent a 13.59% return on the cash commitment, or 5.78% annualized — at Stock Options Channel we call this the YieldBoost.
Below is a chart showing the trailing twelve month trading history for Capital One Financial Corp, and highlighting in green where the $195.00 strike is located relative to that history:
Turning to the calls side of the option chain, the call contract at the $250.00 strike price has a current bid of $30.50. If an investor was to purchase shares of COF stock at the current price level of $207.81/share, and then sell-to-open that call contract as a "covered call," they are committing to sell the stock at $250.00. Considering the call seller will also collect the premium, that would drive a total return (excluding dividends, if any) of 34.98% if the stock gets called away at the January 2029 expiration (before broker commissions). Of course, a lot of upside could potentially be left on the table if COF shares really soar, which is why looking at the trailing twelve month trading history for Capital One Financial Corp, as well as studying the business fundamentals becomes important. Below is a chart showing COF's trailing twelve month trading history, with the $250.00 strike highlighted in red:
Considering the fact that the $250.00 strike represents an approximate 20% premium to the current trading price of the stock (in other words it is out-of-the-money by that percentage), there is also the possibility that the covered call contract would expire worthless, in which case the investor would keep both their shares of stock and the premium collected. The current analytical data (including greeks and implied greeks) suggest the current odds of that happening are 51%. On our website under the contract detail page for this contract, Stock Options Channel will track those odds over time to see how they change and publish a chart of those numbers (the trading history of the option contract will also be charted). Should the covered call contract expire worthless, the premium would represent a 14.68% boost of extra return to the investor, or 6.24% annualized, which we refer to as the YieldBoost.
The implied volatility in the put contract example is 34%, while the implied volatility in the call contract example is 35%.
Meanwhile, we calculate the actual trailing twelve month volatility (considering the last 250 trading day closing values as well as today's price of $207.81) to be 33%. For more put and call options contract ideas worth looking at, visit StockOptionsChannel.com.
Further COF Research:

January 2029 Options Now Available For Capital One Financial (COF)

Key Points
Fintechs and traditional banks are increasingly competing on the same turf.
Buying fintech technology can be faster than building it.
Younger digital customers are increasingly valuable to traditional banks.
Capital One (NYSE: COF) may have already shown the rest of the banking industry where the next big acquisition opportunity lies. In January, Capital One agreed to pay $5.15 billion for Brex, a fintech company that combines corporate credit cards with expense-management software, payments, and artificial intelligence (AI)-powered financial tools. Capital One Chief Executive Officer Richard Fairbank said the deal would accelerate the bank's push into business payments. I don't think Brex will be the last.
Analysts have spent decades watching banks buy other banks. The logic was easy to understand. Buy another bank, pick up its deposits, loans, customers, and branches, eliminate overlapping costs, and hopefully increase earnings.
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That still works. Fifth Third Bancorp (NYSE: FITB), for instance, completed its acquisition of Comerica earlier this year, creating a bank with roughly $294 billion in assets. But banks don't need more branches nearly as much as they need better technology, younger customers, faster payments, and digital platforms capable of competing with fintech companies that were built from scratch for smartphones. That's where the next wave of bank acquisitions is headed.
Buying growth instead of building it
Building a competitive fintech platform isn't easy. A bank can spend years developing new payment systems and mobile banking products; underwriting technology; and building artificial intelligence (AI) capabilities. Or it can just buy a company that already has the technology and millions of customers using it.
PwC recently argued that the technology gap between leading banks and many regional institutions is widening, and that acquiring fintech companies can sometimes be the fastest way to close it. Capital One's Brex deal puts some real money behind that argument.
Brex isn't another bank with thousands of branches. It's an AI-native financial platform used for corporate cards, payments, expense management, and automated financial workflows. Brex says it serves tens of thousands of businesses, including more than 300 public companies. That's what Capital One bought. And if this plays out successfully, other banks will notice.
One fintech I'd watch
One company that fits the profile is Dave (NASDAQ: DAVE). To be sure, I'm not predicting that Dave will be acquired tomorrow. But if I were running a large bank and looking for a fintech acquisition, it would certainly make my list.
Dave has more than 14 million cusrtomers, with its platform focused largely on consumers who need short-term liquidity between paychecks. And this isn't some young, money-losing fintech hoping to eventually figure out a business model.
Second-quarter revenue increased 30% to $170.8 million, while adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) jumped 48% to $75.5 million, and monthly transacting members increased 17% to 3.08 million. Management also raised its full-year revenue forecast to between $725 million and $735 million and $315 million to $325 million in adjusted EBITDA.
That's a fintech with scale, growth, customers, and profits. And it also gives a traditional bank something particularly valuable: access to younger and underserved consumers who may not have much loyalty to conventional banks. The catch is the price.
Dave's market cap clocks in at around $4.6 billion, and an acquisition would almost certainly require a meaningful premium. But Capital One just demonstrated that a major bank is willing to spend more than $5 billion for the right fintech platform. Dave is at least in the right neighborhood.
Banks are becoming technology companies
There's another development you shouldn't ignore. The line separating banks from fintech companies is disappearing from both directions.
Just this month, the fintech Chime (NASDAQ: CHYM) agreed to buy Stride Bank for $590 million, giving Chime direct access to a national banking charter. Chime expects the deal to generate more than $100 million in additional financial benefits through lower costs and expanded lending opportunities.
Also worth noting: U.K-based digital banking platform Revolut just received conditional approval for a U.S. national bank charter as it prepares to launch a full-service American bank in 2027. So fintechs are actually becoming banks while banks are buying fintechs. That's not a coincidence.
Consumers increasingly expect banking to work like every other digital service they use. They want instant payments, automated budgeting, fast credit approval, intuitive apps, and fewer reasons to visit a branch. Banks can build all of that themselves. But for some, writing a multibillion-dollar check may be faster, or even less costly.
Capital One's purchase of Brex could ultimately look less like an unusual acquisition and more like the beginning of a much larger consolidation trend. And if I'm looking for the next major bank acquisition, I'm spending considerably more time looking at a company like Dave than another regional bank.
Should you buy stock in Dave right now?
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Prediction: The Next Big Bank Acquisition Is a Fintech, Not Another Bank

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The research service features daily updates of the Zacks Rank and Zacks Industry Rank, full access to the Zacks #1 Rank List, Equity Research reports, and Premium stock screens, all of which will help you become a smarter, more confident investor.
It also includes access to the Zacks Style Scores.
What are the Zacks Style Scores?
Developed alongside the Zacks Rank, the Zacks Style Scores are a group of complementary indicators that help investors pick stocks with the best chances of beating the market over the next 30 days.
Based on their value, growth, and momentum characteristics, each stock is assigned a rating of A, B, C, D, or F. The better the score, the better chance the stock will outperform; an A is better than a B, a B is better than a C, and so on.
The Style Scores are broken down into four categories:
Value Score
Finding good stocks at good prices, and discovering which companies are trading under their true value, are what value investors like to focus on. So, the Value Style Score takes into account ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and a host of other multiples to highlight the most attractive and discounted stocks.
Growth Score
Growth investors, on the other hand, are more concerned with a company's financial strength and health, and its future outlook. The Growth Style Score examines things like projected and historic earnings, sales, and cash flow to find stocks that will experience sustainable growth over time.
Momentum Score
Momentum investors, who live by the saying "the trend is your friend," are most interested in taking advantage of upward or downward trends in a stock's price or earnings outlook. Utilizing one-week price change and the monthly percentage change in earnings estimates, among other factors, the Momentum Style Score can help determine favorable times to buy high-momentum stocks.
VGM Score
If you want a combination of all three Style Scores, then the VGM Score will be your friend. It rates each stock on their combined weighted styles, helping you find the companies with the most attractive value, best growth forecast, and most promising momentum. It's also one of the best indicators to use with the Zacks Rank.
How Style Scores Work with the Zacks Rank
The Zacks Rank, which is a proprietary stock-rating model, employs earnings estimate revisions, or changes to a company's earnings expectations, to make building a winning portfolio easier.
It's highly successful, with #1 (Strong Buy) stocks producing an unmatched +23.8% average annual return since 1988. That's more than double the S&P 500. But because of the large number of stocks we rate, there are over 200 companies with a Strong Buy rank, plus another 600 with a #2 (Buy) rank, on any given day.
With more than 800 top-rated stocks to choose from, it can certainly feel overwhelming to pick the ones that are right for you and your investing journey.
That's where the Style Scores come in.
You want to make sure you're buying stocks with the highest likelihood of success, and to do that, you'll need to pick stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B. If you like a stock that only has a #3 (Hold) rank, it should also have Scores of A or B to guarantee as much upside potential as possible.
The direction of a stock's earnings estimate revisions should always be a key factor when choosing which stocks to buy, since the Scores were created to work together with the Zacks Rank.
A stock with a #4 (Sell) or #5 (Strong Sell) rating, for instance, even one with Scores of A and B, will still have a declining earnings forecast, and a greater chance its share price will fall too.
Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.
Stock to Watch: Capital One (COF)
Headquartered in McLean, VA, Capital One Financial Corporation was founded in 1988 and primarily focuses on consumer and commercial lending, as well as deposit origination. The company offers a wide range of financial products and services to consumers, small businesses, and commercial clients across the United States through its banking and non-banking subsidiaries.
COF is a #3 (Hold) on the Zacks Rank, with a VGM Score of B.
Momentum investors should take note of this Finance stock. COF has a Momentum Style Score of B, and shares are up 0.3% over the past four weeks.
Eight analysts revised their earnings estimate higher in the last 60 days for fiscal 2026, while the Zacks Consensus Estimate has increased $0.74 to $20.29 per share. COF also boasts an average earnings surprise of +12.8%.
With a solid Zacks Rank and top-tier Momentum and VGM Style Scores, COF should be on investors' short list.
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Why Capital One (COF) is a Top Momentum Stock for the Long-Term

Key Points
Berkshire reduced several of its bank positions in the second quarter.
Berkshire added to one of its airline positions and also bought homebuilders in the quarter.
Both airlines and homebuilders could benefit from lower interest rates.
Berkshire Hathaway (NYSE: BRKA) (NYSE: BRKB) has now revealed two full quarters of stock purchases and sales since Greg Abel became chief executive officer of the enormous conglomerate. He's stepping into the large shoes left by Warren Buffett, who remains executive chairman of the company and actively involved in stock picking, according to various reports.
Abel has not been afraid to shake things up, quickly making Alphabet one of the largest stocks in the portfolio and buying and selling many other stocks. In the second quarter, Berkshire trimmed many of its bank stocks, including Bank of America, while increasing or adding new positions in companies that can benefit from lower yields.
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Is Abel betting on lower interest rates?
Trimming banks
In Q2, Berkshire Hathaway trimmed its Bank of America position by 6% and slashed its positions in Ally Financial and Capital One by 7% and 58%, respectively.
Bank of America is a money-center bank involved in all aspects of banking, from commercial lending to investment banking. Ally and Capital One are large banks as well, but heavily involved in consumer lending, such as auto and credit card lending.
Generally, bank stocks have performed relatively well this year. Not only have banks seemed to serve as diversification away from artificial intelligence, but the yield curve has steepened, meaning shorter-dated bonds yield less than long-term ones.
This is an ideal setup for most banks, which borrow money at the short part of the yield curve and lend toward the longer end. Ally and Capital One haven't performed as well, partly due to investor concerns that consumers are starting to feel the pinch and that loan losses will rise.
Borrowing costs are also high now, which could be stunting loan demand.
Still, if the yield curve keeps steepening, that could, in theory, be good for banks, although I do think longer-term yields at current levels could be starting to spook bank investors as well. Still, in theory, as long as the curve stays steep, that should be good for bank profits, assuming credit stays in check.
Buying sectors that would benefit from lower interest rates
In Q2, Berkshire increased its positions in Delta Air Lines (NYSE: DAL) and Lennar Corp and initiated a new position in D.R. Horton.
Delta is one of the largest U.S. Airlines tend to perform better in a lower-rate environment because most airlines carry significant debt, some of which is tied to variable interest rates that are affected by broader interest rate changes.
At the end of Q2, Delta carried $13.6 billion in debt, 22% of which is subject to variable interest rates, so lower rates would mean lower interest payments.
Additionally, a lower-rate environment tends to stimulate economic activity and spending, benefiting airlines.
Lennar and D.R. Horton are two of the largest homebuilders in the U.S. The mortgage and real estate industries have been absolutely hammered by high rates, particularly at the longer end of the curve, such as the 10-year yield, which directly influences mortgage rates.
Higher rates combined with high home values have made buying a home difficult for much of the country's consumers. Both of these stocks have struggled this year.
You don't buy housing stocks in a rising-rate environment. Although concerns about persistent inflation are certainly real, nobody can say for certain what will happen.
There have been some signs that inflation is softening, perhaps clearing the way for lower rates. An end to the Iran war would surely help this cause, not that anyone knows when that is coming either.
It's worth noting that, aside from Bank of America, the other stocks mentioned in this article are relatively small positions in Berkshire's vast equity portfolio, so they may not be very indicative of anything.
Furthermore, Berkshire typically tries to buy stocks that will perform well throughout the economic cycle.
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Ally is an advertising partner of Motley Fool Money. Bank of America is an advertising partner of Motley Fool Money. Bram Berkowitz has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Berkshire Hathaway, D.R. Horton, and Lennar. The Motley Fool recommends Capital One Financial and Delta Air Lines. The Motley Fool has a disclosure policy.

Is Greg Abel Betting on Lower Interest Rates? The Berkshire Hathaway CEO Just Trimmed Bank Stocks Like Bank of America and Bought 3 Stocks That Would Benefit From Lower Yields.

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