American Express (AXP) Will Benefit from Housing Recovery – Analyst
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Price: $361.57 +0.87%
Rating Summary:
23 Buy, 23 Hold, 3 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 15 | Down: 18 | New: 23
Rating Summary:
23 Buy, 23 Hold, 3 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 15 | Down: 18 | New: 23
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A report by analysts at Nomura pointed out a relationship between American Express (NYSE: AXP) billings and a recovery in housing.
"Conventional wisdom holds that AXP’s billings growth is largely driven by spending at high-end retailers. While a relationship does exist, we remind everyone that correlation does not imply causation. In reality, AXP’s billings are directly driven by other variables, including consumer confidence and overall changes in net worth (a.k.a. wealth effects)," said analyst Bill Carcache.
His analysis of wealth effects showed a a strong relationship between changes in net worth and American Express billings.
"Changes in net worth are largely explained by changes in housing prices and stock market valuations. If the consensus view that housing prices have bottomed is right, we expect AXP billings to enjoy a meaningful source of downside support," said Carcache.
Nomura has a Buy rating on American Express and a price target of $69.
For an analyst ratings summary and ratings history on American Express click here. For more ratings news on American Express click here.
Shares of American Express closed at $58.37 yesterday.
"Conventional wisdom holds that AXP’s billings growth is largely driven by spending at high-end retailers. While a relationship does exist, we remind everyone that correlation does not imply causation. In reality, AXP’s billings are directly driven by other variables, including consumer confidence and overall changes in net worth (a.k.a. wealth effects)," said analyst Bill Carcache.
His analysis of wealth effects showed a a strong relationship between changes in net worth and American Express billings.
"Changes in net worth are largely explained by changes in housing prices and stock market valuations. If the consensus view that housing prices have bottomed is right, we expect AXP billings to enjoy a meaningful source of downside support," said Carcache.
Nomura has a Buy rating on American Express and a price target of $69.
For an analyst ratings summary and ratings history on American Express click here. For more ratings news on American Express click here.
Shares of American Express closed at $58.37 yesterday.
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