Piper Sandler analysts upgraded shares of American Express (NYSE:AXP) to Neutral from Underweight on Tuesday, raising the price target by just $1 to $151 per share.
The analysts told investors they are upgrading the stock as the slowdown in the company's EPS growth is now priced in.
"AXP is down 20%+ since last earnings and now trades below the XLF on FY24 P/E, a level rarely seen for AXP. Although we fully expect revenue growth to slow heading into 2024 and there will be incremental headwinds from weaker credit, we believe the company will continue to produce EPS growth ~10% over the next two years," the analysts wrote.
"In our view, AXP's capacity to defend the revenue growth target will be more difficult due to macro headwinds, but fully expect the company to take steps to try to defend the 15% EPS growth target---implying consensus estimates appear conservative," they added.
Piper Sandler believes the stock is "adequately discounting a slower growth period while trading at <12x consensus FY24E P/E."