American Express Company
BMO Capital Markets analyst Andrew Bauch initiated coverage with an Outperform rating and a $380 price forecast, implying approximately 25% upside from the reference share price of $304.25.
Premium Card Business Fuels Growth Outlook
Bauch believes investors are overlooking American Express' expanding premium card ecosystem amid concerns about rising competition and increased reinvestment spending.
The analyst highlighted growing adoption of fee-paying cards among younger consumers, which could support recurring card fee revenue and long-term profitability.
Bauch also expects the company's reinvestment strategy to generate healthy returns as its premium customer base expands.
The analyst considers American Express one of the strongest companies in his coverage for sustained revenue and earnings growth.
RBC Sees Further Upside Despite Lower Price Forecast
Separately, RBC Capital Markets analyst Jon Arfstrom maintained an Outperform rating on American Express but lowered the price forecast from $415 to $400 on Friday.
RBC remains positive on the company's affluent customer base, diversified revenue streams and strong credit quality.
The firm expects card fee growth to accelerate into the high-teens percentage range in the third quarter, supported by continued customer acquisition and engagement.
RBC projects third-quarter earnings of $4.47 per share and maintains its full-year 2026 earnings forecast of $17.60 per share.
Earnings Report in Focus
American Express is scheduled to report third-quarter earnings on Oct. 23. Wall Street expects earnings of $4.54 per share, up from $4.14 a year earlier. Revenue is projected to reach $20.09 billion, compared with $18.43 billion last year.
Investors will closely watch spending trends, customer acquisition costs and management's outlook for premium card demand.
RBC also expects updates on the company's investment strategy and plans for the anticipated $975 million pretax gain from the sale of its Global Business Travel Group stake.
The company previously projected 2026 revenue growth of 10% and earnings of $17.30 to $17.90 per share.
Faces Fine Over Suspected Money Laundering Activity
Separately, American Express faces a $350 million civil penalty after federal regulators identified widespread failures in its anti-money laundering controls.
On Thursday, the Office of the Comptroller of the Currency (OCC) announced the penalty and a cease-and-desist order against American Express National Bank for violating Bank Secrecy Act compliance requirements.
The regulator said the bank failed to properly identify, evaluate and report approximately $13 billion in suspected trade-based money laundering activity over the past decade.
AXP Price Action: American Express shares were down 0.21% at $307.44 at the time of publication on Friday, according to Benzinga Pro data.
