Are you watching Capital One Financial stock and wondering if it still has room to run, or if it’s time to take some profits? You’re not alone. Over the past year, Capital One has delivered an eye-catching 45.3% return, and the five-year performance stands even taller at 228.4%. More recently, after a slight pullback of -1.3% in the last month, the stock bounced back with an 8.3% gain over the last week. This performance leaves investors pondering whether there is continued upside ahead or just heightened risk to navigate.

Behind these moves, Capital One has made headlines by advancing its digital banking platform and investing heavily in artificial intelligence to personalize customer experiences. These updates have not just caught the market’s attention; they have also subtly shifted how investors think about Capital One’s future growth engine as more banks race to keep up with technological innovation. While these developments are compelling, they also raise bigger questions about whether the stock is priced attractively, especially given the company’s value score of 2 out of 6, which points to it being undervalued in only two areas commonly checked by analysts.

If you have been debating what to do with your shares, valuation is clearly front and center. Next, let’s break down how Capital One stacks up under several classic valuation lenses. Stay tuned, because we will wrap up by highlighting a smarter, more insightful way to approach the value question altogether.

Capital One Financial scores just 2/6 on our valuation checks. See what other red flags we found in the full valuation breakdown .

The Excess Returns valuation model looks at how efficiently a company puts its capital to work, specifically by measuring the returns it generates over and above its cost of equity. For Capital One Financial, this approach examines whether the business is creating value for shareholders by earning returns greater than what investors could expect elsewhere for similar risk.

Capital One's Book Value stands at $170.53 per share, with a Stable Book Value forecasted to reach $184.90 per share, based on weighted future estimates from eight analysts. The company’s Stable Earnings Per Share (EPS) is projected at $22.15, sourced from the consensus of nine analysts on future Return on Equity. The average Return on Equity is a solid 11.98%, and the Cost of Equity is calculated at $16.15 per share. This combination results in an Excess Return of $6.00 per share, meaning Capital One is expected to generate above-market value from each dollar of equity invested.

After running these numbers through the model, the estimated intrinsic value indicates that Capital One shares trade at a 24.4% discount to their fair value. This suggests that the market may be undervaluing the company’s ability to generate future returns well above the cost of equity, even as the financial sector evolves with digital advances.

Result: UNDERVALUED

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Capital One Financial.

Our Excess Returns analysis suggests Capital One Financial is undervalued by 24.4%. Track this in your watchlist or portfolio , or discover more undervalued stocks .

For profitable companies like Capital One Financial, the Price-to-Earnings (PE) ratio is a widely trusted valuation metric. It helps investors understand how much they are paying for each dollar of a company’s earnings, making it especially useful when the company has consistent profitability. Generally, growth expectations and perceived risks play a big role in setting what counts as a “normal” or “fair” PE ratio. Higher expected growth or lower risk can justify a premium, while the opposite tends to push the multiple lower.

Currently, Capital One Financial is trading at a PE ratio of 121.53x. To put this in perspective, the Consumer Finance industry average is just 10.31x, and the peer average stands at 31.38x. On face value, this makes Capital One’s stock look very expensive compared to both its industry and peers.

This is where Simply Wall St’s proprietary “Fair Ratio” metric comes in. Unlike a raw industry or peer comparison, the Fair Ratio accounts for Capital One’s specific outlook: growth forecasts, profit margins, company size, risks, and sector characteristics. For Capital One, the Fair Ratio is calculated to be 34.29x, offering a much more tailored reference point than blunt averages.

Comparing these figures, Capital One is trading well above its Fair Ratio, which signals the stock is richly priced by this measure and may be overvalued at current levels.

Result: OVERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth .

Earlier we mentioned that there's an even better way to understand valuation, so let's introduce you to Narratives. A Narrative is a clear, big-picture story that reflects your own perspective on what drives Capital One’s future. It connects the company’s business outlook and industry context to specific numbers such as future revenue, earnings, and a fair value estimate.

This approach moves beyond static ratios and allows you to blend research, forecasts, and personal conviction into one dynamic view of what a company is actually worth. Narratives connect the dots between where Capital One is headed and how that journey translates into financial projections and estimated fair value, letting you clearly see whether today's price presents an opportunity or a risk.

On Simply Wall St’s Community page, Narratives are available to everyone and used by millions of investors to guide buy or sell decisions by comparing fair value to the latest stock price. They are instantly updated when major news or earnings are reported. For example, some investors see significant potential for Capital One due to the Discover acquisition, projecting fair values well above $260 per share, while others focus on execution risks and assign a more cautious value near $160. By creating or following Narratives, you can invest with confidence, always anchored by real-time insights and transparent logic.

Do you think there's more to the story for Capital One Financial? Create your own Narrative to let the Community know!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include COF .

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com

Are you watching Capital One Financial stock and wondering if it still has room to run, or if it’s time to take some profits? You’re not alone. Over the past year, Capital One has delivered an eye-catching 45.3% return, and the five-year performance stands even taller at 228.4%. More recently, after a slight pullback of -1.3% in the last month, the stock bounced back with an 8.3% gain over the last week. This performance leaves investors pondering whether there is continued upside ahead or just heightened risk to navigate.

Behind these moves, Capital One has made headlines by advancing its digital banking platform and investing heavily in artificial intelligence to personalize customer experiences. These updates have not just caught the market’s attention; they have also subtly shifted how investors think about Capital One’s future growth engine as more banks race to keep up with technological innovation. While these developments are compelling, they also raise bigger questions about whether the stock is priced attractively, especially given the company’s value score of 2 out of 6, which points to it being undervalued in only two areas commonly checked by analysts.

If you have been debating what to do with your shares, valuation is clearly front and center. Next, let’s break down how Capital One stacks up under several classic valuation lenses. Stay tuned, because we will wrap up by highlighting a smarter, more insightful way to approach the value question altogether.

Capital One Financial scores just 2/6 on our valuation checks. See what other red flags we found in the full valuation breakdown .

The Excess Returns valuation model looks at how efficiently a company puts its capital to work, specifically by measuring the returns it generates over and above its cost of equity. For Capital One Financial, this approach examines whether the business is creating value for shareholders by earning returns greater than what investors could expect elsewhere for similar risk.

Capital One's Book Value stands at $170.53 per share, with a Stable Book Value forecasted to reach $184.90 per share, based on weighted future estimates from eight analysts. The company’s Stable Earnings Per Share (EPS) is projected at $22.15, sourced from the consensus of nine analysts on future Return on Equity. The average Return on Equity is a solid 11.98%, and the Cost of Equity is calculated at $16.15 per share. This combination results in an Excess Return of $6.00 per share, meaning Capital One is expected to generate above-market value from each dollar of equity invested.

After running these numbers through the model, the estimated intrinsic value indicates that Capital One shares trade at a 24.4% discount to their fair value. This suggests that the market may be undervaluing the company’s ability to generate future returns well above the cost of equity, even as the financial sector evolves with digital advances.

Result: UNDERVALUED

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Capital One Financial.

Our Excess Returns analysis suggests Capital One Financial is undervalued by 24.4%. Track this in your watchlist or portfolio , or discover more undervalued stocks .

For profitable companies like Capital One Financial, the Price-to-Earnings (PE) ratio is a widely trusted valuation metric. It helps investors understand how much they are paying for each dollar of a company’s earnings, making it especially useful when the company has consistent profitability. Generally, growth expectations and perceived risks play a big role in setting what counts as a “normal” or “fair” PE ratio. Higher expected growth or lower risk can justify a premium, while the opposite tends to push the multiple lower.

Currently, Capital One Financial is trading at a PE ratio of 121.53x. To put this in perspective, the Consumer Finance industry average is just 10.31x, and the peer average stands at 31.38x. On face value, this makes Capital One’s stock look very expensive compared to both its industry and peers.

This is where Simply Wall St’s proprietary “Fair Ratio” metric comes in. Unlike a raw industry or peer comparison, the Fair Ratio accounts for Capital One’s specific outlook: growth forecasts, profit margins, company size, risks, and sector characteristics. For Capital One, the Fair Ratio is calculated to be 34.29x, offering a much more tailored reference point than blunt averages.

Comparing these figures, Capital One is trading well above its Fair Ratio, which signals the stock is richly priced by this measure and may be overvalued at current levels.

Result: OVERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth .

Earlier we mentioned that there's an even better way to understand valuation, so let's introduce you to Narratives. A Narrative is a clear, big-picture story that reflects your own perspective on what drives Capital One’s future. It connects the company’s business outlook and industry context to specific numbers such as future revenue, earnings, and a fair value estimate.

This approach moves beyond static ratios and allows you to blend research, forecasts, and personal conviction into one dynamic view of what a company is actually worth. Narratives connect the dots between where Capital One is headed and how that journey translates into financial projections and estimated fair value, letting you clearly see whether today's price presents an opportunity or a risk.

On Simply Wall St’s Community page, Narratives are available to everyone and used by millions of investors to guide buy or sell decisions by comparing fair value to the latest stock price. They are instantly updated when major news or earnings are reported. For example, some investors see significant potential for Capital One due to the Discover acquisition, projecting fair values well above $260 per share, while others focus on execution risks and assign a more cautious value near $160. By creating or following Narratives, you can invest with confidence, always anchored by real-time insights and transparent logic.

Do you think there's more to the story for Capital One Financial? Create your own Narrative to let the Community know!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include COF .

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com

After running these numbers through the model, the estimated intrinsic value indicates that Capital One shares trade at a 24.4% discount to their fair value. This suggests that the market may be undervaluing the company’s ability to generate future returns well above the cost of equity, even as the financial sector evolves with digital advances.

Result: UNDERVALUED

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Capital One Financial.

Our Excess Returns analysis suggests Capital One Financial is undervalued by 24.4%. Track this in your watchlist or portfolio , or discover more undervalued stocks .

For profitable companies like Capital One Financial, the Price-to-Earnings (PE) ratio is a widely trusted valuation metric. It helps investors understand how much they are paying for each dollar of a company’s earnings, making it especially useful when the company has consistent profitability. Generally, growth expectations and perceived risks play a big role in setting what counts as a “normal” or “fair” PE ratio. Higher expected growth or lower risk can justify a premium, while the opposite tends to push the multiple lower.

Currently, Capital One Financial is trading at a PE ratio of 121.53x. To put this in perspective, the Consumer Finance industry average is just 10.31x, and the peer average stands at 31.38x. On face value, this makes Capital One’s stock look very expensive compared to both its industry and peers.

This is where Simply Wall St’s proprietary “Fair Ratio” metric comes in. Unlike a raw industry or peer comparison, the Fair Ratio accounts for Capital One’s specific outlook: growth forecasts, profit margins, company size, risks, and sector characteristics. For Capital One, the Fair Ratio is calculated to be 34.29x, offering a much more tailored reference point than blunt averages.

Comparing these figures, Capital One is trading well above its Fair Ratio, which signals the stock is richly priced by this measure and may be overvalued at current levels.

Result: OVERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth .

Earlier we mentioned that there's an even better way to understand valuation, so let's introduce you to Narratives. A Narrative is a clear, big-picture story that reflects your own perspective on what drives Capital One’s future. It connects the company’s business outlook and industry context to specific numbers such as future revenue, earnings, and a fair value estimate.

This approach moves beyond static ratios and allows you to blend research, forecasts, and personal conviction into one dynamic view of what a company is actually worth. Narratives connect the dots between where Capital One is headed and how that journey translates into financial projections and estimated fair value, letting you clearly see whether today's price presents an opportunity or a risk.

On Simply Wall St’s Community page, Narratives are available to everyone and used by millions of investors to guide buy or sell decisions by comparing fair value to the latest stock price. They are instantly updated when major news or earnings are reported. For example, some investors see significant potential for Capital One due to the Discover acquisition, projecting fair values well above $260 per share, while others focus on execution risks and assign a more cautious value near $160. By creating or following Narratives, you can invest with confidence, always anchored by real-time insights and transparent logic.

Do you think there's more to the story for Capital One Financial? Create your own Narrative to let the Community know!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include COF .

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com