Will American Express Stock Rebound In 2021?

NYSE: AXP | American Express Company  News, Ratings, and Charts

American Express Company’s (AXP) investments in digital payment solutions have put it in a favorable position to play the industry’s rebound in 2021, we think. As consumer spending improves with an abatement in the COVID-19 pandemic in response to global vaccination efforts, pent up consumer demand should become increasingly manifest and with it a greater need for digital payment services.

American Express Company (AXP - Get Rating) is a leading financial services company that provides charge card and credit payment products, and travel-related services worldwide. The company operates through three segments: Global Consumer Services Group, Global Commercial Services, and Global Merchant and Network Services.

AXP has witnessed a steady recovery in overall consumer spending volumes since lows hot in mid-April. It has reported positive year-over-year growth in non-T&E spending in its third quarter earnings release.

Although 2020 has been a rough year for the company due to lower loan volumes and lower travel-related card spending, AXP stock is expected to move higher in 2021 pushed along by a digital-payments trend. Moreover, large scale coronavirus vaccine distribution should speed economic global re-engagement, serving as a catalyst for the stock’s rebound.

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The company’s increasing customer acquisition and robust liquidity position have allowed it to gain 54.6% over the past nine months. This impressive performance combined with several other factors has helped AXP earn a “Buy” rating in our proprietary rating system.

Here is how our proprietary POWR Ratings system evaluates AXP:

Trade Grade: B

AXP is currently trading above its 50-day and 200-day moving averages of $110.92 and $98.75, respectively. This indicates that the stock is in an uptrend. The stock has gained 16.3% over the past three months, reflecting short-term bullishness.

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