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American Express (AXP) Gains But Lags Market: What You Should Know

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American Express (AXP - Free Report) closed at $144.76 in the latest trading session, marking a +0.4% move from the prior day. This change lagged the S&P 500's 2.45% gain on the day. At the same time, the Dow added 2.15%, and the tech-heavy Nasdaq gained 0.18%.

Prior to today's trading, shares of the credit card issuer and global payments company had lost 9.34% over the past month. This has lagged the Finance sector's loss of 6.21% and the S&P 500's loss of 5.71% in that time.

Investors will be hoping for strength from American Express as it approaches its next earnings release. In that report, analysts expect American Express to post earnings of $2.38 per share. This would mark a year-over-year decline of 15%. Our most recent consensus estimate is calling for quarterly revenue of $12.4 billion, up 21.04% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $9.76 per share and revenue of $50.5 billion, which would represent changes of -2.59% and +19.16%, respectively, from the prior year.

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

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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. Over the past month, the Zacks Consensus EPS estimate has moved 0.32% lower. American Express currently has a Zacks Rank of #3 (Hold).

In terms of valuation, American Express is currently trading at a Forward P/E ratio of 14.78. This valuation marks a premium compared to its industry's average Forward P/E of 9.73.

Investors should also note that AXP has a PEG ratio of 1.11 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Financial - Miscellaneous Services industry currently had an average PEG ratio of 0.71 as of yesterday's close.

The Financial - Miscellaneous Services industry is part of the Finance sector. This industry currently has a Zacks Industry Rank of 214, which puts it in the bottom 16% 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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