Is Capital One Financial Stock a Buy?

Capital One Financial (NYSE: COF) is not your typical bank. When deciding whether or not to buy it, this is probably the most important thing to keep in mind. But what exactly is Capital One Financial? It's a mixture of a credit card issuer and a car loan maker. These both tend to be higher-risk areas of the banking industry. Here's a deeper look at the issues that you'll face if you buy Capital One Financial.

Taking prudent risks on Wall Street can lead to very strong returns. For example, Capital One Financial's stock price has risen around 60% over the past five years, versus a 20% advance for the broader banking sector. Very clearly, whatever Capital One's management team is doing has worked well over the last five years.