American Express Renews Multi-Year Agreement with NBA
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 3 days ago
0mins
Should l Buy AXP?
Source: Benzinga
- Investment Growth: American Express's increased investment in the WNBA and USA Basketball is expected to significantly enhance brand visibility and engagement with basketball fans, thereby driving customer loyalty and transaction volumes.
- Financial Performance: On January 30, the company reported a 10% year-over-year revenue growth to $18.98 billion, surpassing the analyst consensus estimate of $18.92 billion, primarily driven by higher Card Member spending and increased net interest income.
- Future Outlook: American Express expects full-year revenue between $78.73 billion and $79.45 billion, representing a 9%-10% year-over-year increase, indicating strong growth potential despite the analyst consensus of $78.62 billion.
- Technical Analysis: American Express shares are currently priced at $367.27, trading 2.2% above the 20-day and 2.4% above the 100-day simple moving averages, demonstrating strong long-term market performance, although the relative strength index (RSI) is in neutral territory.
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Analyst Views on AXP
Wall Street analysts forecast AXP stock price to rise
21 Analyst Rating
7 Buy
13 Hold
1 Sell
Moderate Buy
Current: 342.880
Low
280.00
Averages
373.63
High
425.00
Current: 342.880
Low
280.00
Averages
373.63
High
425.00
About AXP
American Express Company is a globally integrated payments company with card-issuing, merchant-acquiring and card network businesses. It offers products and services to a range of customers, including consumers, small businesses, mid-sized companies and large corporations around the world. Its segments include U.S. Consumer Services (USCS), Commercial Services (CS), International Card Services (ICS) and Global Merchant and Network Services (GMNS). USCS offers travel and lifestyle services as well as banking and non-card financing products. CS offers payment and expense management, banking and non-card financing products. ICS provides services to international customers, including travel and lifestyle services, and manages certain international joint ventures and its loyalty coalition business. GMNS operates a payments network that processes and settles card transactions, acquires merchants and provides multichannel marketing programs and capabilities, services and data analytics.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
American Express Market Performance and Outlook
- Share Buyback Strategy: American Express's ongoing stock buybacks have gradually increased Berkshire Hathaway's stake to 22.1%, which not only enhances its ownership in the company but also reflects confidence in future growth prospects.
- Revenue and Profit Growth: Over the past decade, American Express has seen a 120% revenue increase and a 205% rise in diluted earnings per share, demonstrating strong performance amid economic expansion, with expectations to achieve long-term growth targets of 10% and mid-teens, respectively.
- Premium Market Positioning: With luxury credit card offerings and an annual fee increase of 75%, American Express successfully attracts high-spending customers, and this pricing power contributes to sustainable financial success for the company.
- Industry Leadership: Despite a current price-to-earnings ratio of 23.3, which has expanded by 124% over the past decade, American Express continues to show strong market competitiveness driven by the rising penetration of cashless transactions, attracting cautious investor interest.
See More
American Express Stock Shows Strong Performance
- Significant Stock Growth: As of February 9, American Express's stock price has risen 180% over the past five years, with total returns including dividends reaching 198%, highlighting its strong performance in the investment portfolio and attracting investor interest.
- Increased Berkshire Holdings: Berkshire Hathaway currently owns 22.1% of American Express, with this stake gradually increasing to 16.5% of its portfolio due to the company's ongoing stock buybacks, enhancing Berkshire's control and potential returns from this investment.
- Brand Value and Pricing Power: American Express leverages its strong brand and premium credit card offerings to raise average annual fees by 75% from 2020 to 2025, reflecting its pricing power and providing a stable revenue stream for the company.
- Sustained Growth Potential: Over the past decade, American Express's revenue has climbed 120%, with diluted earnings per share increasing by 205%, as the leadership team aims for long-term growth targets of 10% and mid-teens, indicating a favorable outlook amid economic expansion.
See More
Credit Card Companies Face Bipartisan Pressure
- Political Pressure Intensifies: Amid persistent inflation, Trump and Sanders have found common ground in seeking to lower credit card annual percentage rates, with Trump proposing a 10% cap and Sanders advocating for a permanent 15% cap, potentially reshaping the profitability of credit card companies.
- Cautious Industry Response: Major credit card issuers like Capital One are in a holding pattern amidst political rhetoric, fearing that if a cap is implemented, they will be compelled to cut credit lines, adversely affecting credit access for lower-income households.
- Profitability at Risk: Analysts predict that a long-term rate cap could reduce Capital One's earnings per share by 25% or wipe them out entirely, as credit card operations account for approximately 74% of its total revenue, primarily derived from interest on customer balances.
- Acquisition Impact Significant: Capital One's $35 billion acquisition of Discover last year will be affected by any interest rate limits, as Discover's credit card balances will also be impacted, further diminishing Capital One's competitive edge, especially without a robust payment network.
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Berkshire Likely Sold Additional Shares of Apple and Bank of America in Q4
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Warren Buffett's Leadership: This filing is particularly significant as it marks Warren Buffett's final quarter leading Berkshire Hathaway, raising interest in any strategic moves made by him and his team.
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Linde Reports Strong Quarterly Earnings Exceeding Expectations
- Quarterly Revenue Growth: Linde reported quarterly revenue of $18.98 billion on January 30, reflecting a 10% year-over-year increase that surpassed the analyst consensus estimate of $18.92 billion, indicating strong performance in the industrial gas sector and boosting investor confidence.
- Earnings Beat Expectations: On February 5, Linde announced earnings per share of $4.20, exceeding the analyst consensus estimate of $4.18, demonstrating effective management in cost control and market demand, which further solidifies its market position.
- Strong Sales Figures: The company achieved quarterly sales of $8.764 billion, surpassing the analyst consensus estimate of $8.644 billion, reflecting Linde's competitiveness and growth potential in the global market, likely attracting more investor interest.
- Stock Performance: Linde's shares rose 1.1% to close at $472.86 on Thursday, indicating a positive market reaction to its financial performance, which may support future investment decisions.
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Fundstrat Launches GRNY ETF Amid Weak Performance
- Diverse ETF Themes: Fundstrat's GRNY ETF launched in November 2024, encompasses various investment themes including value investing, despite a year-to-date decline of 0.32%, it has risen 18.31% over the past 52 weeks, indicating some market appeal.
- Overlap with Dow Jones: The GRNY ETF shares eight stocks with the Dow Jones Industrial Average, including well-known tech stocks like Apple, Amazon, Microsoft, and Nvidia, with respective weights of 2.55%, 2.16%, 2.11%, and 2.51% in GRNY, reflecting a similarity in investment strategies.
- Differing Investment Styles: The GRNY ETF employs a rules-based stock selection process focusing on stocks that meet two or more key themes, with current themes including PMI recovery, energy stocks, and cybersecurity, aimed at attracting millennial investors.
- Market Performance Comparison: In contrast to the GRNY ETF, the SPDR Dow Jones Industrial Average ETF has increased by 3.46% year-to-date and 12.08% over the past 52 weeks, showcasing the relative strength of Dow components, which may impact investor confidence in GRNY.
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American Express Market Performance and Outlook
- Share Buyback Strategy: American Express's ongoing stock buybacks have gradually increased Berkshire Hathaway's stake to 22.1%, which not only enhances its ownership in the company but also reflects confidence in future growth prospects.
- Revenue and Profit Growth: Over the past decade, American Express has seen a 120% revenue increase and a 205% rise in diluted earnings per share, demonstrating strong performance amid economic expansion, with expectations to achieve long-term growth targets of 10% and mid-teens, respectively.
- Premium Market Positioning: With luxury credit card offerings and an annual fee increase of 75%, American Express successfully attracts high-spending customers, and this pricing power contributes to sustainable financial success for the company.
- Industry Leadership: Despite a current price-to-earnings ratio of 23.3, which has expanded by 124% over the past decade, American Express continues to show strong market competitiveness driven by the rising penetration of cashless transactions, attracting cautious investor interest.
See More
American Express Stock Shows Strong Performance
- Significant Stock Growth: As of February 9, American Express's stock price has risen 180% over the past five years, with total returns including dividends reaching 198%, highlighting its strong performance in the investment portfolio and attracting investor interest.
- Increased Berkshire Holdings: Berkshire Hathaway currently owns 22.1% of American Express, with this stake gradually increasing to 16.5% of its portfolio due to the company's ongoing stock buybacks, enhancing Berkshire's control and potential returns from this investment.
- Brand Value and Pricing Power: American Express leverages its strong brand and premium credit card offerings to raise average annual fees by 75% from 2020 to 2025, reflecting its pricing power and providing a stable revenue stream for the company.
- Sustained Growth Potential: Over the past decade, American Express's revenue has climbed 120%, with diluted earnings per share increasing by 205%, as the leadership team aims for long-term growth targets of 10% and mid-teens, indicating a favorable outlook amid economic expansion.
See More
Credit Card Companies Face Bipartisan Pressure
- Political Pressure Intensifies: Amid persistent inflation, Trump and Sanders have found common ground in seeking to lower credit card annual percentage rates, with Trump proposing a 10% cap and Sanders advocating for a permanent 15% cap, potentially reshaping the profitability of credit card companies.
- Cautious Industry Response: Major credit card issuers like Capital One are in a holding pattern amidst political rhetoric, fearing that if a cap is implemented, they will be compelled to cut credit lines, adversely affecting credit access for lower-income households.
- Profitability at Risk: Analysts predict that a long-term rate cap could reduce Capital One's earnings per share by 25% or wipe them out entirely, as credit card operations account for approximately 74% of its total revenue, primarily derived from interest on customer balances.
- Acquisition Impact Significant: Capital One's $35 billion acquisition of Discover last year will be affected by any interest rate limits, as Discover's credit card balances will also be impacted, further diminishing Capital One's competitive edge, especially without a robust payment network.
See More
Berkshire Likely Sold Additional Shares of Apple and Bank of America in Q4
Berkshire Hathaway's Filing: The company is set to release its fourth-quarter equity holdings, which will be closely examined by investors and analysts.
Warren Buffett's Leadership: This filing is particularly significant as it marks Warren Buffett's final quarter leading Berkshire Hathaway, raising interest in any strategic moves made by him and his team.
See More
Linde Reports Strong Quarterly Earnings Exceeding Expectations
- Quarterly Revenue Growth: Linde reported quarterly revenue of $18.98 billion on January 30, reflecting a 10% year-over-year increase that surpassed the analyst consensus estimate of $18.92 billion, indicating strong performance in the industrial gas sector and boosting investor confidence.
- Earnings Beat Expectations: On February 5, Linde announced earnings per share of $4.20, exceeding the analyst consensus estimate of $4.18, demonstrating effective management in cost control and market demand, which further solidifies its market position.
- Strong Sales Figures: The company achieved quarterly sales of $8.764 billion, surpassing the analyst consensus estimate of $8.644 billion, reflecting Linde's competitiveness and growth potential in the global market, likely attracting more investor interest.
- Stock Performance: Linde's shares rose 1.1% to close at $472.86 on Thursday, indicating a positive market reaction to its financial performance, which may support future investment decisions.
See More
Fundstrat Launches GRNY ETF Amid Weak Performance
- Diverse ETF Themes: Fundstrat's GRNY ETF launched in November 2024, encompasses various investment themes including value investing, despite a year-to-date decline of 0.32%, it has risen 18.31% over the past 52 weeks, indicating some market appeal.
- Overlap with Dow Jones: The GRNY ETF shares eight stocks with the Dow Jones Industrial Average, including well-known tech stocks like Apple, Amazon, Microsoft, and Nvidia, with respective weights of 2.55%, 2.16%, 2.11%, and 2.51% in GRNY, reflecting a similarity in investment strategies.
- Differing Investment Styles: The GRNY ETF employs a rules-based stock selection process focusing on stocks that meet two or more key themes, with current themes including PMI recovery, energy stocks, and cybersecurity, aimed at attracting millennial investors.
- Market Performance Comparison: In contrast to the GRNY ETF, the SPDR Dow Jones Industrial Average ETF has increased by 3.46% year-to-date and 12.08% over the past 52 weeks, showcasing the relative strength of Dow components, which may impact investor confidence in GRNY.
See More
