Two Insiders Are Bullish on Capital One Financial Corp. (COF)

American Express Company (NYSE:AXP) and Discover Financial Services (NYSE:DFS) are good peers for Capital One Financial Corp. (NYSE:COF), and we can also compare the stock to credit card brands Visa Inc (NYSE:V) and Mastercard Inc (NYSE:MA). Discover Financial Services (NYSE:DFS) is also in value territory from our perspective, with its trailing earnings multiple coming in at 10 and with both revenue and earnings increasing in its most recent quarter compared to the same period in the previous fiscal year. As such it looks worthy of further research. Wall Street analysts expect American Express Company (NYSE:AXP) to improve its bottom line over the next couple years, but given its trailing earnings it does not look undervalued and its last quarterly report shows little change in revenue or earnings versus a year earlier. Visa Inc (NYSE:V) and Mastercard Inc (NYSE:MA) receive more premium valuations from the market, and as a result their forward P/Es are in the 18-20 range. We can certainly see these two companies doing well in the future, but revenue growth of “only” 10% or so (which is about what Visa Inc (NYSE:V) and Mastercard Inc (NYSE:MA) did in their last quarterly report from a year ago) is not particularly strong given their pricing.

As a result we think that we would avoid American Express, Visa, and Mastercard at least for now. Capital One Financial Corp. (NYSE:COF) and Discover don’t have as favorable a brand as those three companies but their stock prices are low relative to the current state of their business and recent financial results have been positive. We think that either of the two would be worth considering on a value basis.

Disclosure: I own no shares of any stocks mentioned in this article.