UPDATE: Morgan Stanley Reiterates Equal-Weight Rating, Raises PT on Capital One Financial Corp. on Raised Estimates

In a report published Monday, Morgan Stanley analyst Betsy L. Graseck reiterated an Equal-Weight rating on

, but raised the price target from $74.00 to $80.00. In the report, Morgan Stanley noted, “While avg US card loans declined 1% q/q in 1Q14 on seasonality and impact of HSBC loan runoff, we expect COF can begin to grow this portfolio in 2H14. Mgmt highlighted that new account originations were strong, line-increases for sub-prime customers are accelerating, and the previously announced $1bn runoff is loaded toward 1H14, setting the stage for modest 2H loan growth (we expect up 2% y/y in 4Q). Moreover, COF is successfully growing non-card loans: primarily C&I (up 20% y/y), CRE (up 18%) and Auto (up 18%). We look for 2% avg total loan growth in 2014 and 4% in 2015. Mortgage runoff $5bn in 2014 (guidance increased from prior $4bn) remains a significant headwind.” Capital One Financial Corp. closed on Thursday at $74.89.