Good news for credit card giant American Express (NYSE:AXP), as it got a lift from a new analyst perspective. This isn’t the first such boost it’s had in recent memory, either, as we’ve seen several analysts of late boost price targets. But this one sent American Express shares up modestly in Friday afternoon’s trading.
American Express got an upgrade to Buy at Monness Crespi Hardt after its analyst, Gus Gala, took a look at the matter and pivoted on his beliefs regarding the credit card sector. Gala noted that American Express’ focus on the higher-end consumer should likely help it out, and Gala himself underestimated just how resilient that sector of the credit card market actually was.
Even if, as Gala put it, “…macro softness materialize(s),” the overall levels of spending and lending to customers should keep American Express in a good position. A number of product refreshes won’t hurt either, and several “new customer vintages” still growing into their prime should also lend some support to American Express.
American Express Focuses on the Millennial and Gen Z Market
In fact, reports note that American Express focuses on the Millennial and Gen Z market, which are starting to come into their own as peak consumers. While their ability to consume is somewhat hampered by macroeconomic conditions and their current debt load—student loans are a major problem in this cohort—they’re still in a decent position overall, at least for now. Throw in the fact that American Express has a particular focus on luxury travel rewards—millennials prefer “experiences” to “things” in 78% of cases as recently as July 2023—and that’s one more point in its favor.
Is Amex a Good Stock to Buy?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on AXP stock based on nine Buys, eight Holds, and three Sells assigned in the past three months, as indicated by the graphic below. After a 41.81% rally in its share price over the past year, the average AXP price target of $217.47 per share implies 2.11% downside risk.
