American Express Stock Forecast

Early Bird Prime for August 25, 2024

American Express (NYSE: AXP) is one of the top-performing stocks on the Dow Jones Industrial Average in 2024. With a dazzling 33.45% increase this year, the stock has been on a tear, even hitting its 52-week high just last week. It also outshines the S&P 500.

But let's not get too carried away with the confetti and streamers. American Express has carved out a niche by focusing on higher-income consumers, attracting affluent customers who can drop some serious cash. It's like the VIP section of the credit card world, where the drinks are always top-shelf and the velvet ropes are always open.

With over 140 million American Express cards in circulation and a 99% acceptance rate among U.S. merchants who take credit cards, it's clear that Amex is no slouch. But just because you're popular doesn't mean you're invincible.

After reaching its new high, some wonder if the good times for American Express are about to hit a speed bump. Could the stock be heading for a nosedive?

This week, the plot thickened when BofA Securities decided to rain on Amex's parade by downgrading the stock from a Buy rating to Neutral. Analysts at BofA Securities pointed to "subdued billings volume growth" and a challenging spending environment for high-end consumers.

Revenue for American Express is still growing at a respectable 10%, but that's a slower pace than last year.

Given these risks, some investors are starting to ask the tough questions. Is it time to sell American Express stock? Or at the very least, should we stop buying it? What should investors do right now? Well, here’s the answer:

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