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American Express Company (AXP), with a market cap of $167.8 billion, operates as a leading diversified financial services firm in the payments and travel sectors. The New York-based company offers a wide array of services, including credit and charge cards, merchant services, and travel-related products, catering to consumers and businesses worldwide.
Companies valued at $10 billion or more are generally considered "large-cap" stocks, and American Express fits this criterion perfectly. Renowned for its premium card offerings, American Express excels in providing exclusive benefits to high-spending customers and maintaining a significant presence in the global market, serving a diverse range of clients with its extensive service portfolio.
However, American Express has slipped 5.1% from its 52-week high of $244.41, achieved last month. Despite this recent pullback, shares of American Express are up 4.5% over the past three months, outperforming the broader Dow Jones Industrials Average's ($DOWI) marginal gains over the same time frame.
Longer term, AXP is up 24.6% on a YTD basis, outpacing the DOWI's 3.5% gains. Moreover, shares of American Express have surged 36.1% over the past 52 weeks, compared to Dow Jones' 15.9% returns over the same time frame.
To confirm the bullish price trend, AXP has been trading above its 200-day moving average since November last year and mostly remained above its 50-day moving average during this period despite some fluctuations.
American Express has consistently outperformed the broader market due to its strong revenue growth driven by high card member spending and increased net interest income, coupled with effective cost management, resulting in higher profitability. Moreover, the stock surged 6.2% on April 19 due to significantly surpassing Q1 earnings expectations, driven by strong card member spending, robust fee-based income, and optimistic full-year revenue and earnings guidance.
To emphasize the stock’s outperformance, top rival Mastercard Incorporated (MA) is underperforming AXP. Shares of Mastercard have gained 18.1% over the past 52 weeks and are up 5.2% on a YTD basis.
However, analysts are cautiously optimistic about AXP stock's prospects. The stock has a consensus rating of "Moderate Buy" from the 22 analysts covering the stock, and the stock is currently trading above the mean price target of $228.95.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
