Iris Gao, an analyst from DBS, maintained the Hold rating on American Express (AXP – Research Report). The associated price target is $270.00.
Maximize Your Portfolio with Data Driven Insights:
- Leverage the power of TipRanks' Smart Score, a data-driven tool to help you uncover top performing stocks and make informed investment decisions.
- Monitor your stock picks and compare them to top Wall Street Analysts' recommendations with Your Smart Portfolio
Iris Gao has given her Hold rating due to a combination of factors impacting American Express’s current and future financial performance. While the company posted an 8% year-over-year increase in revenue and a 6% rise in EPS, indicating disciplined expense management and lower provisions, its revenue growth projection for FY24 has been revised to the lower end of the initial forecast. This revision suggests a cautious approach due to soft spending trends in the market.
Furthermore, although American Express continues to leverage its strong brand in the high-end credit card market and benefits from increased digital engagement, there are concerns over short-term credit quality. The rise in delinquencies and the potential for increased credit costs cast uncertainty over consumer spending and revenue growth in the coming fiscal years. The current valuation of 19x 12-month forward PER reflects these concerns, balancing the company’s long-term potential with inherent credit risks, hence the Hold rating.
According to TipRanks, Gao is a 3-star analyst with an average return of 18.6% and a 75.00% success rate. Gao covers the Financial sector, focusing on stocks such as American Express, Mastercard, and Visa.
In another report released on January 28, Citi also maintained a Hold rating on the stock with a $320.00 price target.