Capital One Financial Corp
NYSE:COF
If you don’t study any companies, you have the same success buying stocks as you do in a poker game if you bet without looking at your cards.
Utilize notes to systematically review your investment decisions. By reflecting on past outcomes, you can discern effective strategies and identify those that underperformed. This continuous feedback loop enables you to adapt and refine your approach, optimizing for future success.
Each note serves as a learning point, offering insights into your decision-making processes. Over time, you'll accumulate a personalized database of knowledge, enhancing your ability to make informed decisions quickly and effectively.
With a comprehensive record of your investment history at your fingertips, you can compare current opportunities against past experiences. This not only bolsters your confidence but also ensures that each decision is grounded in a well-documented rationale.
Do you really want to delete this note?
This action cannot be undone.
| 52 Week Range |
106.18
190.3524
|
| Price Target |
|
We'll email you a reminder when the closing price reaches USD.
Choose the stock you wish to monitor with a price alert.
This alert will be permanently deleted.
Capital One Financial Corp
Discount Rate
COF Cost of Equity
Discount Rate
COF's Cost of Equity, calculated using the formula
Risk-Free Rate + Beta x ERP,
stands at 7.78%.
The Beta, indicating the stock's volatility relative to the market, is 0.83, while the current Risk-Free Rate, based on government bond yields, is 4.41%, and the ERP, measuring the extra return over the risk-free rate required by investors, is 4.06%.
What is COF's discount rate?
COF
's current Cost of Equity is 7.78%.
In the valuation of banks and insurance companies, only the cost of equity is used due to their unique capital structures and regulatory environments.
These institutions heavily rely on debt, regulated more stringently than other industries, making the Weighted Average Cost of Capital (WACC) less applicable and accurate for them. The cost of equity offers a more direct measure of the risk and return expectations relevant to these specific sectors.
How is Cost of Equity for COF calculated?
The Cost of Equity represents the return a company must offer investors to compensate for the risk of investing in its stock. It's calculated using the Capital Asset Pricing Model (CAPM), which combines the risk-free rate, the stock's beta, and the equity risk premium (ERP).
This model considers the inherent risk of investing in the stock compared to a risk-free investment and the market's overall risk.
Here is how we calculate the cost of equity for
COF
You don't have any saved screeners yet
