Capital One Updates: Fair Value $58, Adding Jobs on Growth Outlook

Capital One (NYSE:COF) plans to add more than 300 jobs in the Richmond, Virginia area by the end of this year. The company has already added about 2,300 positions in the region this year and expects to increase its headcount in the bank and card operations, information technology and other business and support roles. ^[1] Capital One is one of the largest banking and credit card company and competes with Visa (NYSE:V), MasterCard (NYSE:MA), Bank of America (NYSE:BAC) and JPMorgan Chase (NYSE:JPM).

See our full analysis for Capital One

Capital One is probably the only large banking company in the U.S. that is aggressively increasing its headcount when the weak economic outlook has forced others to cut jobs. Capital One sees opportunity in uncertainty and recently announced the acquisition of ING Bank FSB and an agreement to buy HSBC’s U.S. card and retail services business.  We estimate that these acquisition will help Capital One increase its credit card loans outstanding, on which the company earns interest, from $75 billion currently to about $92 billion by the end of our forecast period.

We have a price estimate of $58 on Capital One’s stock, about 30% above the current market price.

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1. Capital One adding 300 jobs, Richmond Times Dispatch, December 14, 2011 [↩]