American Express (AXP) Stock Down, BMO Capital Lowers Earnings Estimates
NEW YORK (TheStreet) -- American Express (AXP) - Get Report stock fiscal earnings estimates were lowered for 2017 to $5.63 from $5.64, and for 2018 to $6.20 from $6.22, at BMO Capital this morning as the firm expects the company to spend more on investments.
Additionally, the BMO lowered the company's stock price target to $73 fro $76 while maintaining a "market perform" rating.
The firm decreased the company's earnings estimates even though its 2016 fiscal second quarter results beat Wall Street's estimates because American Express also announced "many forms" of investment spending in the second half of 2016, such as on marketing and technology.
The New York-based financial services company reported fiscal 2016 earnings per share of $1.52, compared to BMO's $1.44 estimate, according to the analyst note. "Relative to our forecasts, AXP's beat was driven by lower-than-expected provisions for losses, as well as lower recurring expenses (i.e.,excluding the impact of the Costco gain and restructuring costs)."
Shares of American Express are down 0.96% to $63.86 in early morning trading.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:
We rate AMERICAN EXPRESS CO as a Hold with a ratings score of C+. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, good cash flow from operations and notable return on equity. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk, poor profit margins and a generally disappointing performance in the stock itself.
You can view the full analysis from the report here: AXP
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