Chad Brand

Capital One Financial Reduces Guidance on Mortgage Weakness

Quarterly numbers for COF vary so much that they always beat or miss by a fairly wide margin, so I think the annual numbers are all that really matters. Quarterly fluctuations just give us trading opportunities.

If you annualize the 12 cents due to the mortgage biz you get a 48 cent annual impact. They cut guidance by 40 cents. They clearly didn't expect mortgages to be as weak as they were (everything was okay until March when NEW started the panic) and now they are assuming no incremental eanrings from mortgages in 2007. That seems to explain the 40 cent cut in guidance for the year.