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American Express (AXP) Outpaces Stock Market Gains: What You Should Know

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American Express (AXP) closed the most recent trading day at $140.40, moving +1.28% from the previous trading session. The stock outpaced the S&P 500's daily gain of 1.06%. Meanwhile, the Dow gained 1.05%, and the Nasdaq, a tech-heavy index, added 0.4%.

Coming into today, shares of the credit card issuer and global payments company had lost 18.04% in the past month. In that same time, the Finance sector lost 9.62%, while the S&P 500 lost 8.3%.

Wall Street will be looking for positivity from American Express as it approaches its next earnings report date. This is expected to be July 22, 2022. The company is expected to report EPS of $2.38, down 15% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $12.4 billion, up 21.04% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $9.76 per share and revenue of $50.5 billion. These totals would mark changes of -2.59% and +19.16%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for American Express. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.1% lower. American Express is currently sporting a Zacks Rank of #3 (Hold).

Digging into valuation, American Express currently has a Forward P/E ratio of 14.21. This valuation marks a premium compared to its industry's average Forward P/E of 10.19.

Also, we should mention that AXP has a PEG ratio of 1.07. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. AXP's industry had an average PEG ratio of 0.6 as of yesterday's close.

The Financial - Miscellaneous Services industry is part of the Finance sector. This group has a Zacks Industry Rank of 218, putting it in the bottom 14% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow AXP in the coming trading sessions, be sure to utilize Zacks.com.


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