Capital One Financial Earnings: Here’s Why Investors are Cashing Shares Now

Capital One Financial Corp. (NYSE:COF) delivered a strong profit and missed Wall Street’s expectations, AND came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are down 7.18%.

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Capital One Financial Corp. Earnings Cheat Sheet

Results: Net income increased 107.13% to $843 million ($1.41 per diluted share) in the quarter versus a net gain of $407 million in the year-earlier quarter.

Revenue: Rose 22.84% to $5.62 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: Capital One Financial Corp. reported adjusted net income of $1.41 per share. By that measure, the company missed the mean analyst estimate of $1.6. It missed the average revenue estimate of $5.8 billion.

Quoting Management: “Capital One remains well positioned to deliver sustained shareholder value through sure-footed execution, substantial capital generation, and disciplined capital allocation for the benefit of our shareholders,” said Richard D. Fairbank, Chairman and Chief Executive Officer…

…As a first step, we expect to return to a meaningful dividend in 2013, following the completion of the current CCAR process.”

Key Stats:

Revenue decreased 12.23% from $6.4 billion in the previous quarter. Net income decreased 28.44% from $1.18 billion in the previous quarter.

Looking Forward: Analysts have a more positive outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has risen from a profit of $1.76 to a profit $1.77. For the current year, the average estimate has moved up from a profit of $6.08 to a profit of $6.43 over the last ninety days.

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(Company fundamentals provided by Xignite Financials.)