The Monthly Gems by Allan TongAmerican ExpressAXPTOP PICKNov 01, 2022

Just delivered a good quarter and great guidance. Last November they reported that October sales were light, so short-sellers piled in while shares rose. So, today's rally triggered a short squeeze that drove the Dow

They report Friday. They have a track record of reporting solid numbers, but then someone points out a bad line item and shares fall. Wait for the second day when some analyst downgrades it to buy./

Wait till they report next week and listen to the CEO's comments before deciding. Buy on the dip? No. Shares are mid-range.

Owns a big position.  Their November loan balances were up 15% while delinquencies up only 50 basis points. Trades at 16x forward. Likes this.

Likes trend, and believes in value of traditional business. Likes nature of company. Stock indicating bounce off of the floor. Will recommend buying small amounts. 

Owns shares in Visa, but credit card business strong. Credit risk a concern with business. Visa a pure "payment processing" business. Better options in sector. 

Just reported overall positive results, but shares were clubbed because they didn't raise their full-year forecast, and volume growth decelerated. However, US spending rose 9% YOY with travel/entertainment up 13% including restaurant spending. Gen-Z and Millennial spending up 18%.

Very attractive business with excellent capital allocation skills. Share count keeps going down. Not worried about slowing economy with this business. Share price a good place to buy. Berkshire Hathaway a major shareholder. Recent earnings exceeded expectations. 

Shocked that it trades below 15x forward PE. Constant-currency business is up 12%. Good mix of revenues and are managing operational expenses. US consumer growth is 13%, international is 23%. Much cheaper than Mastercard.

The valuation of Visa and Mastercard has been elevated, but the growth has supported it. AmEx has the cheaper valuation; they benefit from international travel. He prefers AXP. He owns a little Visa. The future of payments processing? It's Apple Pay, which kids use through their phones. The sector has a lot of moving parts and competition, so it's hard to say where it's going.

Spending, travelling and higher interest rates are catalysts.

Likes it, but prefers Mastercard while others like MA and Visa. Expectations heading into AXP's recent quarter were too high--and remain too high. Let this come down a little more before it bottoms.

He owns Visa and Mastercard, but not AmEx over its debt-to-equity ratio. AmEx does have strong momentum now, though. It is approaching tougher comps, but this is a buying opportunity because it can be perceived as weakness. All told, he is considering buying this.

Reported a mixed quarter, but she has faith and is holding on and even bought more. Why? the US consumer grew 13% and international card spend grew 23%. Overall card member spend is at an all-time high. She bought on today's dip and expects AmEx to grow earnings substantially this year.

Reported a mixed quarter, but another record revenue quarter. Likes it. Are concerns over higher provisions and some delinquencies. 60% of new cardholders are millennials which is really a good growth opportunity.