BUSINESS IS BOOMING FOR CREDIT-CARD COMPANIES
Today’s chart notes the solid performance of Capital One. As Brian Hunt says, it’s another sign that “things can’t be all that bad” with the U.S. economy…
Over the past year, we’ve shown you the price strength in home improvement chain Home Depot and giant hotel operator Wyndham Worldwide as evidence that the U.S. economy is slowly improving.
Credit cards are a good gauge of how the average U.S. consumer is doing.
As long as people are using credit cards and paying bills, credit-card companies do well.
Last week, shares of Capital One (COF) surged to a new multiyear high.
The stock is now approaching its highest level since before the 2008 financial crisis.
Capital One’s latest quarterly results showed that consumer purchases rose 9% versus the same period in 2011. More importantly, consumers aren’t racking up new debt. Loan levels for Capital One are flat overall. That means people are paying off their credit-card bills before borrowing more.
With credit-card stocks this strong, “things can’t be all that bad” in America…
– Larsen Kusick
Source: Market Notes
