VALUATION HIGHLIGHTS

1. Credit Cards constitute 70% of the Trefis price estimate for Capital One's stock.
2. Consumer Loans constitute 20% of the Trefis price estimate for Capital One's stock.
3. Commercial Loans constitute 10% of the Trefis price estimate for Capital One's stock.

WHAT HAS CHANGED?

Latest Earnings: Q2 FY'26

Capital One reported Q2 FY'26 total net revenue of $15.9 billion, representing a 27% year-over-year increase and 4% sequential growth, driven by higher net interest income and contributions from recent acquisitions. Diluted EPS reached $4.73, compared to a net loss of $8.58 per share in Q2 FY'25, while adjusted EPS came in at $5.81, up 6% year-over-year, supported by lower credit loss provisions and an expanded net interest margin of 8.01%.

Note: Capital One's FY'25 ended on December 31, 2025. Q2 FY'26 ended on June 30, 2026.

Progress on Discover Integration and System Account Migration

Capital One advanced its integration of Discover Financial Services, initiating phased account migrations to Capital One's digital infrastructure. The ongoing integration, alongside the acquisition of Brex in April 2026, expands Capital One's transaction processing ecosystem, proprietary payment network capabilities, and small business banking footprint.

POTENTIAL UPSIDE & DOWNSIDE TO TREFIS PRICE

Below are key drivers of Capital One's value that present opportunities for upside or downside to the current Trefis price estimate:

Credit Card

• Net Interest Margin and Yields: Capital One benefits from elevated credit card loan yields and expanding net interest margins across its revolving loan portfolio. Upside exists if purchase volume and loan balances increase, whereas higher funding costs or yield compression present downside risk.


• Credit Losses and Provisioning: Lower net charge-offs and provision releases directly enhance net income. Upside potential stems from resilient consumer credit trends, while macroeconomic deterioration or rising default rates among subprime borrower segments pose downside risks.

For additional details, select a division from the interactive Trefis split for Capital One at the top of the page.

BUSINESS SUMMARY

Capital One Financial Corporation is a major American financial services holding company offering consumer and commercial banking, credit card services, auto loans, and deposit products through digital channels, branches, and proprietary payment networks.

SOURCES OF VALUE

Credit Card services represent Capital One's primary source of value due to high net interest margins and substantial fee revenue from card processing.

Proprietary Payment Network and Scale

The acquisition of Discover provides Capital One with a closed-loop payment network, allowing it to capture merchant discount fees, reduce network assessment costs paid to third parties, and control transaction processing end-to-end.

Data Analytics and Digital Banking Infrastructure

Capital One utilizes modern cloud infrastructure and proprietary underwriting algorithms, enabling real-time risk assessment, targeted marketing, and operational efficiency across consumer and commercial portfolios.

KEY TRENDS

Integration of Vertical Payment Networks

Banking institutions are combining card issuance with proprietary network ownership to capture payment processing fees and build end-to-end payment ecosystems.

Normalization of Consumer Credit Performance

Credit card issuers are managing loan loss reserves and charge-off trajectories as consumer credit trends stabilize following post-pandemic adjustment cycles.