Analyst predicts Capital One stock could soar to $427 post Discover deal

From CNBC: 2025-03-25 13:34:00

Wall Street firm BTIG predicts that Capital One’s stock could soar to $427 per share if its merger with Discover Financial Services goes through, a 137% increase. Even if the merger falls through, BTIG remains optimistic, with a price target of $208 per share. Capital One CEO Richard Fairbank may sell part of Discover’s subprime portfolio to appease regulators. Analysts believe Capital One has significant earnings potential by utilizing Discover’s network, boosting market share. The pending merger has garnered some antitrust concerns, but analysts from Citi, KBW, and Jefferies are confident it will be approved. Capital One shares have rebounded and are up nearly 6% since March 14. Despite ongoing legal battles, Capital One maintains its position to complete the merger. Analysts remain bullish on Capital One, emphasizing potential growth post-merger with Discover. Jim Cramer advises investors to hold onto Capital One stock, anticipating a positive outcome with the Discover deal. The deal could lead to reduced fees by shifting transactions onto Discover’s network. Richard Fairbank is willing to make compromises, like selling part of Discover’s subprime portfolio, to ensure deal approval.

Read more: How much Capital One’s stock would be worth post-Discover deal, per an analyst