American Express Stock Movement Shows Slight Increase Amid Sector Changes
On Tuesday, June 25, American Express (AXP) reached a closing price of $230.68, marking a slight increase of +0.04% from the previous day. This movement was modest compared to the S&P 500’s daily gain of 0.16%. Similarly, the Dow saw an increase of 0.04%, while the Nasdaq rose by 0.49%.
Monthly Performance Analysis
Over the past month, American Express shares have declined by 2.81%. This underperformance contrasts with the Finance sector’s smaller loss of 0.22% and the S&P 500’s gain of 3.22%. The decline in American Express stock highlights a more significant struggle within the company compared to the broader market.
Anticipated Earnings Report
Investors are eagerly awaiting American Express’s upcoming earnings report, scheduled for July 19, 2024. Company is projected to report an earnings per share (EPS) of $3.22, reflecting an 11.42% increase from the same quarter last year. Additionally, revenue is expected to reach $16.59 billion, showing a growth of 10.23% year-over-year.
Full-Year Financial Forecasts
Looking at the full year, Zacks Consensus Estimates predict earnings of $13 per share and revenue of $66.44 billion for American Express. These figures indicate growth rates of 15.97% for earnings and 9.79% for revenue compared to the previous year. This optimistic forecast suggests that American Express may recover from its recent underperformance.
Analyst Estimates and Stock Outlook
Analyst estimates play a essential role in shaping investor expectations. Recent changes in these estimates can provide insights into the company’s near-term prospects. Positive revisions often signal a favorable outlook for the company. However, over the last 30 days, the Zacks Consensus EPS estimate for American Express has slightly decreased by 0.05%. Consequently, American Express currently holds a Zacks Rank of #4 (Sell).
Valuation and Metrics
From a valuation standpoint, American Express is currently trading at a Forward P/E ratio of 17.74. This ratio is higher than the industry average of 10.91, indicating that American Express is valued at a premium relative to its peers. Additionally, Company’s PEG ratio stands at 1.31. This metric, which takes into account expected earnings growth, suggests that American Express is trading at a reasonable valuation given its growth prospects. In contrast, the average PEG ratio for the Financial – Miscellaneous Services industry is 0.79.
Industry Position and Ranking
Financial – Miscellaneous Services industry, which includes American Express, is part of the broader Finance sector. This industry currently holds a Zacks Industry Rank of 147, placing it in the bottom 42% of all industries. Strength of individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Research indicates that the top 50% rated industries typically outperform the bottom half by a factor of 2 to 1.
Zacks Rank System
Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), has a proven track record of success. Stocks rated #1 have historically achieved an average annual return of +25% since 1988. Despite its current Zacks Rank of #4, American Express’s long-term prospects remain of interest to investors.
American Express has experienced slight market movement amid broader sector fluctuations. Company’s upcoming earnings report and analyst estimates will be closely watched by the investment community. While the stock has underperformed recently, the overall financial forecasts suggest potential growth. Investors should keep an eye on American Express’s performance and industry trends to make informed decisions.
