American Express initiated with a Neutral at Citi

Citi analyst Keith Horowitz initiated coverage of American Express with a Neutral rating and $250 price target. The analyst says that while American Express “has the tenets of an attractive long-term core holding” given the combination of attractive business model in a growth market led by a strong management team, the bar has been set fairly high in terms of the valuation multiple. The market now seems to be pricing in a rebound in discount revenues which is possible, but Citi’s in-house economic view is for a pullback in consumer spend, which warrants a more cautious outlook, the analyst tells investors in a research note. The firm would look to be opportunistic on a pullback in American Express shares.