Stock

Sell American Express and buy lower as it breaks below key support

American Express Company (NYSE:AXP) has posted mixed performance this year. Despite touching an all-time high of nearly $200 in February, it has since failed to replicate gains. The stock is currently going lower, taking total losses to more than 11% year-to-date. The performance is still better than a drawdown of almost 21% in the S&P index.

American Express’s lower losses compared to the S&P can be explained by its sector. The company offers payment card services, competing with the likes of Visa and Mastercard. The rivals have also posted lower losses in the year. Whereas tech stocks have been hit by Fed’s policy tightening this year, payment card issuers had a soft landing. These companies have been raising their annual percentage rates. As a result, they can escape additional costs, helping them wither the economic turmoil. 

Going forward, American Express is optimistic about higher revenues and earnings. In its first-quarter earnings call, CFO Jeffrey Campbell reaffirmed the FY22 outlook. He cited the recovery from Covid-19 as a key driver of the results. While we believe these fundamentals will boost stock in the coming days, technical indicators point to bearish pressure.

AXP breaks below $155 support

Source – TradingView

Technically, American Express is bearish after breaking below $155 support. An uncertain market outlook could be blamed as investors take profit at the all-time high. We expect the current bear pressure to persist. The stock could fall up to $116, where potential support lies. 

Summary

We recommend a sell of American Express based on bearish technical indicators. However, the company’s fundamentals remain robust despite an uncertain outlook. Investors should relinquish the holding for a chance to buy lower.

The post Sell American Express and buy lower as it breaks below key support appeared first on Invezz.

Disclaimer: MonopolyWinnersUpdates.com, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2022 MonopolyWinnersUpdates.com. All Rights Reserved.

To Top