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American Express (AXP) Dips More Than Broader Markets: What You Should Know

·3 min read

In the latest trading session, American Express (AXP) closed at $148.60, marking a -0.79% move from the previous day. This change lagged the S&P 500's 0.41% loss on the day. Elsewhere, the Dow lost 0.55%, while the tech-heavy Nasdaq added 0.07%.

Coming into today, shares of the credit card issuer and global payments company had lost 4.76% in the past month. In that same time, the Finance sector lost 3.73%, while the S&P 500 lost 5.13%.

Wall Street will be looking for positivity from American Express as it approaches its next earnings report date. On that day, American Express is projected to report earnings of $2.36 per share, which would represent year-over-year growth of 3.96%. Meanwhile, our latest consensus estimate is calling for revenue of $13.52 billion, up 23.69% from the prior-year quarter.

AXP's full-year Zacks Consensus Estimates are calling for earnings of $9.85 per share and revenue of $52.84 billion. These results would represent year-over-year changes of -1.7% and +24.67%, respectively.

Investors should also note any recent changes to analyst estimates for American Express. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.37% higher. American Express is currently a Zacks Rank #3 (Hold).

Digging into valuation, American Express currently has a Forward P/E ratio of 15.2. Its industry sports an average Forward P/E of 9.94, so we one might conclude that American Express is trading at a premium comparatively.

Meanwhile, AXP's PEG ratio is currently 1.16. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Financial - Miscellaneous Services was holding an average PEG ratio of 0.55 at yesterday's closing price.

The Financial - Miscellaneous Services industry is part of the Finance sector. This industry currently has a Zacks Industry Rank of 134, which puts it in the bottom 47% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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