Regulatory Volatility Keeps JPMorgan Cautious on Capital One Financial (COF)

Core Viewpoint - Capital One Financial Corporation (NYSE:COF) is highlighted as a strong debt-free stock to consider for investment, with recent price target increases from analysts indicating positive sentiment despite potential regulatory challenges in the credit card industry [1][6]. Group 1: Analyst Ratings and Price Targets - JPMorgan analyst Richard Shane raised Capital One Financial's price target to $256 from $237 while maintaining a Neutral rating, reflecting a positive outlook amidst a broader Q4 preview for the consumer finance sector [1]. - RBC Capital also increased its price target for Capital One from $255 to $275, maintaining a Sector Perform rating, indicating confidence in the company's performance [6]. Group 2: Regulatory Environment and Risks - President Trump's proposal to cap credit card interest rates at 10% for one year is seen as a potential structural disruption to the credit card industry, which could significantly impact issuer profitability and consumer access to credit [2][4]. - JPMorgan analysts characterized the proposal as a "high-severity, low-probability risk" that may face legal challenges, suggesting that while the risk exists, its implementation is uncertain [5].