Citi Sees Nearly 20% Upside In Capital One Financial Corp. (COF)

Citi Investment Research has a Buy rating and a $60 price target on shares of Capital One Financial Corp. COF. In a note to clients, Citi writes, "COF March monthly managed credit data showed a -12 bps decline in the Nat'l Lending net charge-off (NCO) rate to 4.84% while delinquencies were also down 27 bps to 4.40% (see Figure 1). US Cards & Auto drove the improvement in NCOs. Autos NCOs were boosted by +14 bps this month due to a change in charge-off methodology. US card balances fell –1.7% m/m given normal seasonal pay downs of holiday spending." Citi goes on to say, "Overall, March results were solid with further improvement in credit offset by seasonal declines in card balances. We were impressed with the sharp decline in delinquencies this month which should bode well for future credit trends. COF reports Q1 results on Thursday, April 21st. Reiterate our Buy rating as COF is well positioned to compete in the card business and is leveraged to an economic recovery." Shares of COF are off 31 cents today to close at $49.94, a loss of 0.6%.