Capital One (COF) has diversified its revenue stream over the years and boasts a strong financial foundation. The company also possesses a narrow moat and a stellar management team. Unfortunately, the shares of this company will likely drop dramatically in the event of a recession. I provide pros and cons of a prospective investment below.

Is Capital One Misunderstood?

To accurately appraise Capital One as an investment, one must have insight into the manner in which banking institutions are valued by the investment community. Larger banks are awarded higher valuation multiples due to the more diverse nature of their businesses. Furthermore, a large bank boasts a stable, low cost source of funding through a large deposit base.

READ FULL ARTICLE HERE