Citi‘s Most Read - Financials & FinTech

Research evidence excerpt

Citi‘s Most Read - Financials & FinTech

Strategy Inc (MSTR.O) - Top 10 Takeaways from Investor Meetings with Michael

Saylor

Strategy is in the middle of a deliberate, sequenced repair of its "Stretch" (STRC)

preferred stock, which has been trading below par following a drawdown in cash

reserves and a sharp decline in Bitcoin collateral. Saylor was direct: getting STRC

back to $100 is not optional... it is the precondition for the company's entire digital

credit business to function. The near-term playbook is clear: build the USD reserve

first, then chip away at STRC through programmatic buybacks. Longer term, the

company's ambition is to scale STRC into a trillion-dollar digital credit franchise,

stripping Bitcoin's return and passing it to credit investors as a tax-efficient

dividend. What stood out in our meetings was less the vision and more the candid

operational admissions, the explicit sequencing of capital priorities, and the

acknowledgment that some earlier strategic choices were "mistakes."

Buy/High Risk | Target price US$136.00

Peter Christiansen, CFA

Capital One Financial Corporation (COF.N) - 2Q26 Initial Take – Core PPNR Miss

on Expenses, But Still Good Quarter with Credit a Bright Spot

COF reported a ~41c core PPNR miss to consensus (~20c to our estimates) mostly

driven by the other expense line (~26c headwind) and marginally softer NII (~7c

headwind), though mgmt noted some NIM benefits still to play through as

elevated cash balances normalize. Credit trends were exceptionally constructive,

charge-offs were down 22bps sequentially to 3.23% (~2bps lower vs cons), and

card DQs of 3.37% improved ~18bps y/y. The ~$650 mil reserve release provided a

meaningful boost to the bottom line (~$1.10 tailwind vs cons) with coverage ratio