American Express: Fairly Valued Despite Spending Pressures (Upgrade)

Seeking Profits5.36K FollowersFollow5ShareSavePlay(10min)CommentsSummaryAmerican Express is upgraded to a "Hold" as valuation normalizes post-pullback, despite macro headwinds from higher oil prices and travel disruptions.AXP's premium customer base and strong credit quality (1.3%-1.5% delinquency) provide resilience, but spending growth is expected to decelerate to 5%-7% by H2 2026.Guidance for 2026 anticipates 9%-10% revenue growth and $16.90-$17.50 EPS, slightly below prior targets due to energy-driven risks.AXP's capital return yield is ~3.7%, with continued buybacks and a recent 16% dividend increase, but shares remain relatively expensive at 17.4x earnings. magnez2/iStock Unreleased via Getty Images While shares of American Express (AXP) have been a moderate performer over the past year, gaining 8%, the stock has had a more difficult start to 2026. Indeed, shares are down over 20% from their highs as concerns have mounted about credit quality andThis article was written bySeeking Profits5.36K FollowersFollowOver fifteen years of experience making contrarian bets based on my macro view and stock-specific turnaround stories to garner outsized returns with a favorable risk/reward profile. If you want me to cover a specific stock or have a question for an article, just let me know!Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.