Capital One Financial Earnings: Beats the Street on Profit Rise

S&P 500 (NYSE:SPY) component Capital One Financial Corporation (NYSE:COF) reported net income above Wall Street’s expectations for the third quarter. Capital One Financial is a financial services company that markets a variety of financial products and services through its banking and non-banking subsidiaries.

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Capital One Financial Corporation Earnings Cheat Sheet

Results: Net income for Capital One Financial Corporation rose to $1.18 billion ($2.01 per share) vs. $813 million ($1.77 per share) in the same quarter a year earlier. This marks a rise of 44.9% from the year-earlier quarter.

Revenue: Rose 39.2% to $5.78 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Capital One Financial Corporation beat the mean analyst estimate of $1.58 per share. It beat the average revenue estimate of $5.16 billion.

Quoting Management: “Capital One posted solid results across all of our businesses in the third quarter, including strong contributions from ING Direct and the HSBC U.S. credit card business,” said Richard D. Fairbank, Chairman and Chief Executive Officer. “We are well positioned to sustain strong returns and capital generation, even in an environment with low industry growth and prolonged low interest rates.”

Key Stats:

The company topped expectations last quarter after falling short of forecasts in the second quarter with net income of 33 cents versus a mean estimate of net income of $1.35 per share.

Net income has dropped 9.4% year-over-year on average across the last five quarters. Performance was hurt by an 89.8% decline in the second quarter from the year-earlier quarter.

Looking Forward: Analysts have a positive outlook for the company’s performance next quarter. Over the past seven days, the average estimate for the fourth quarter has gone up to $1.56 a share from $1.52. For the fiscal year, the average estimate has moved up from $6.49 a share to $6.63 over the last seven days.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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