Deutsche Banc Alex. Brown upgraded Capital One Financial (COF) and American Express (AXP) to buy from market perform.
Analyst Mark Alpert says he upgraded the financial services companies due to the surprising strength of the consumer sector. He notes he had been skeptical that Capital One was growing too fast in the recession but if, in fact, the economy is not as bad as everyone thought, then there is less risk of loan losses.
For Capital One, Alpert maintains his estimates of $3.48 2002 EPS, and $4.19 2003. He has a target in the $70s. Alpert also upgraded American Express, as he thinks it's going to be bouncing back from a depressed 2001 faster than he thought.
For American Express, Alpert raised the $1.89 2002 EPS estimate to $2.05, and upped the $2.18 2003 estimate to $2.40, with a price target in the $50s.