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American Express (AXP) Dips More Than Broader Markets: What You Should Know

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In the latest trading session, American Express (AXP - Free Report) closed at $118.59, marking a -1.66% move from the previous day. This change lagged the S&P 500's 0.46% loss on the day. Elsewhere, the Dow lost 0.91%, while the tech-heavy Nasdaq lost 0.06%.

Coming into today, shares of the credit card issuer and global payments company had gained 32.41% in the past month. In that same time, the Finance sector gained 13.36%, while the S&P 500 gained 7.53%.

Investors will be hoping for strength from AXP as it approaches its next earnings release. In that report, analysts expect AXP to post earnings of $1.36 per share. This would mark a year-over-year decline of 33%. Our most recent consensus estimate is calling for quarterly revenue of $9.51 billion, down 16.29% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $3.38 per share and revenue of $36.30 billion, which would represent changes of -58.78% and -16.66%, respectively, from the prior year.

Any recent changes to analyst estimates for AXP should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. AXP is currently a Zacks Rank #3 (Hold).

Looking at its valuation, AXP is holding a Forward P/E ratio of 35.72. For comparison, its industry has an average Forward P/E of 13.79, which means AXP is trading at a premium to the group.

Meanwhile, AXP's PEG ratio is currently 7.5. 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. AXP's industry had an average PEG ratio of 3.03 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 198, which puts it in the bottom 23% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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