American Express vs Capital One Financial Which Is Stronger?

American Express and Capital One Financial are two prominent players in the financial services sector, each offering a range of products and services to their customers. American Express, with its long history and strong brand reputation, focuses on premium credit card and travel services. On the other hand, Capital One is known for its diverse portfolio of consumer banking and lending products. Both companies have seen fluctuations in their stock prices over the years, making them interesting options for investors looking to capitalize on the financial sector's growth.

American Express or Capital One Financial?

When comparing American Express and Capital One Financial, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between American Express and Capital One Financial.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. American Express has a dividend yield of 0.94%, while Capital One Financial has a dividend yield of 0.96%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. American Express reports a 5-year dividend growth of 10.01% year and a payout ratio of 19.64%. On the other hand, Capital One Financial reports a 5-year dividend growth of 8.45% year and a payout ratio of 26.80%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with American Express P/E ratio at 20.65 and Capital One Financial's P/E ratio at 16.51. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. American Express P/B ratio is 6.88 while Capital One Financial's P/B ratio is 1.14.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, American Express has seen a 5-year revenue growth of 0.74%, while Capital One Financial's is 1.26%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with American Express's ROE at 34.09% and Capital One Financial's ROE at 7.32%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $287.58 for American Express and $186.47 for Capital One Financial. Over the past year, American Express's prices ranged from $156.03 to $296.83, with a yearly change of 90.24%. Capital One Financial's prices fluctuated between $104.21 and $198.30, with a yearly change of 90.29%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.