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Last quarter Capital One (NYSE:COF) blew past earnings projections, reporting $2.86 versus the consensus estimate of $2.06 per share. Despite the beat, the company kept its annual guidance steady at $7.40-$7.80 for 2006.

Some investors were disappointed that Q1 was so strong but the company was seemingly being conservative about the year. When asked, management expressed that they saw things being tougher and uncertain later in the year, prompting them to reiterate their guidance rather than raise it.

Fast forward to this past Thursday night and investors should be no be surprised. Despite the company leaving estimates for the year at $7.60, analysts were at $7.91 in 2006 EPS heading into the report. The stock reacted by dropping to under $80 per share after earnings were reported.

Given what we saw and heard in Q1, the earnings miss should not be as surprising as some seem to think. The stock's drop appears very overdone and I would suggest long term growth oriented investors pick up Capital One shares today at a sale price of under $80, or 10 times earnings. Several years from now it will prove an excellent entry point, in my view.

COF 1-yr chart:

COF 1-yr

Source: Capital One Earnings Miss Provides Investors an Excellent Entry Point