​Capital One's (COF) Path Forward: Analyst Adjustments, Brex Integration, and Competitive Positioning

Capital One Financial Corp. (NYSE:COF) is one of the best cheap stocks to buy for 2026. On January 27, Evercore ISI analyst John Pancari lowered the price target on Capital One Financial Corp. (NYSE:COF) to $265 from $290 but kept an Outperform rating on the stock. Pancari acted just days after Capital One announced on January 22 that it had entered into a definitive agreement to acquire fintech company Brex for approximately $5.15 billion in a combination of stock and cash.

According to Pancari, Evercore’s updated target reflects the firm’s view that Capital One’s expected earnings growth has softened. Evercore reduced its 2026 EPS estimate to $18.87 from $19.26 and its 2027 EPS estimate to $22.83 from $23.32. These revisions assume the Brex deal closes in the third quarter of 2026, said Pancari. He and the team at Evercore estimated the acquisition will produce approximately 5% tangible book value dilution and 1% core EPS dilution related to share issuance.

The analyst noted that near-term expenses are likely to rise as Brex is integrated into Capital One’s payments platform and as the company continues investments in the Discover Financial Services network. Pancari projected a total efficiency ratio of about 51.7% in 2026 and about 51.2% in 2027, compared with roughly 50% in the latter half of 2025.

But despite these challenges, Pancari said he is encouraged by management’s commitment to prudent capital management and consistent earnings power following Capital One’s integration of Discover Financial Services. And, he views the Brex acquisition as a strategic move that could help Capital One compete more effectively with American Express in the payments space.

Capital One Financial Corp. (NYSE:COF) provides consumer and commercial banking services. This includes credit cards, auto loans, savings accounts, and small business lending, with operations across the United States.

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Disclosure: None. This article is originally published at Insider Monkey.