Capital One catches two price target bumps as broad market slides
Every weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch — an actionable afternoon update, just in time for the last hour of trading on Wall Street. Market update: The S & P 500 traded lower for the third consecutive session after investors digested economic data releases, including October and November job numbers and retail sales. The AI infrastructure trade was on better footing at the start of the session, but Broadcom struggled to hold onto its early gains. Every sector was in the red on Tuesday. Health care lagged, and the uninspiring update from Pfizer may have caused investors who rushed into the group on Monday to unwind some trades. Bristol Myers and Eli Lilly fell in sympathy, but both are still up on the week. The worst-performing sector on Tuesday was energy, after the price of a barrel of West Texas Intermediate Crude fell to its lowest level since 2021. The drop in oil prices should continue to translate into lower pump prices. According to a new estimate from GasBuddy, the national average gas price on Christmas Day is expected to be approximately $2.79 per gallon, down from last year’s $3.00. The report says this decline in pump prices could save motorists roughly $521 million compared to the previous year. PT bumps : Two firms raised their price targets on Capital One on Tuesday: Bank of America increased its PT to $268 from $248, and Morgan Stanley raised its PT to $280 from $272. Capital One is Morgan Stanley’s top pick in its consumer financial universe. BofA research focused on Capital One’s November credit metrics, which were solid enough for the firm to raise its fourth-quarter earnings-per-share estimate to $3.87 from $3.78. Morgan Stanley’s note was more of a 2026 look-ahead, when Capital One’s upside could come from a ramp in share repurchases, realization of Discovery-related synergies, and continued improvement in credit trends. Notably, on the buyback, Morgan Stanley expects management to repurchase $13.4 billion worth of stock in 2026 and $14.2 billion in 2027. Considering the bank’s current market cap of about $150 billion, that would be one powerful buyback. Linde upgrade : Some housekeeping on industrial gas giant Linde following last night’s appearance by CEO Sanjiv Lamba on “Mad Money.” Jim said in today’s Morning Meeting that the stock is a buy and that we’re upgrading our rating to 1. Lamba’s $1 million share purchase on Dec. 8 sent a strong signal to the market that the recent stock decline doesn’t reflect the company’s fundamentals; the stock hasn’t had a down day since. Although we don’t expect a volume growth inflection next year, we came away with a better appreciation for how closely its gases are tied to semiconductor fab activity. Up next : Lennar reports after the closing bell on Tuesday. Before the open on Wednesday, we’ll see earnings from General Mills and Jabil . On the data side, we’ll see MBA mortgage applications. (See here for a full list of the stocks in Jim Cramer’s Charitable Trust.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
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