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The Long and the Short of it -
Capital One Financial (COF) long
This analysis is for the week ending 5.18.07, written on
5.13.07
Capital One Financial has been chosen as our stock of
the week this week. We have provided a detailed
trading plan for this stock for all of our members.
As usual, make sure that you review our real-time
trading report for COF in conjunction
with this analysis because it will help you follow the
recommendations offered herein.
COF Report (members
only):
COF.
Non-Members:
FREE TRIAL.
Free Report:
FREE COF REPORT
Market Direction:
Barring any negative news events we expect the market to
surge higher in the early part of the week. CPI is
clearly important, but more than anything else the
periodic speeches by the Fed Governors will be telling.
If everything is held constant, we expect a surge and
probably a stall late in the week.
Valuation:
COF trades at 11.96 x earnings and the company is
expected to grow at 13.07% annually over the next 5
years according to Reuters Consensus. Although the
Mortgage side of the business is a concern for 2007,
longer term estimates have remained unchanged.
Technical Analysis:
COF tested longer term support almost perfectly in the
recent past and it is now in the process of increasing
back towards longer term resistance. We have
identified this as longer term parameter #3 in our real
time report for COF. In order to do this though
the stock must first increase past intra-channel
resistance. We have identified this as longer term
parameter #2. These 2 parameters will be
important; the stocks ability to move higher will be
determined by these parameters. Review them now by
reading our real time trading report for COF.
Additional
information: On Monday UBS will host a
financial services conference in which COF will
participate. In addition, the Fed Governor's
speeches this week will almost surely have an impact on
the Financial Services sector as well. Pay very
close attention to these events.
Trading Plan:
A specific trading
plan based on our real time trading report for COF has
been made immediately available. Specific entry
levels, target prices, and stop losses are provided.
Members can access the report and the plan by first
clicking the link below, and then on the 'Stock of the
Week' option under the Trading Tab.
Non-members
can access the report for free by clicking the link
below, but in order to view the exact plan you must sign
up for a free trial. |
