Great article! I bought this last year when you recommended at $225 and was considering adding last week but was concerned about a recession. Is this still a good buy price if a recession looms?
Yes, I still like this price, even though a recession looms. I think a lot has been priced in already, and AmEx should be somewhat well-positioned. Of course, if we see some panic selling amid growing unemployment and other factors, we could see lower prices, but I wouldn't hold off on buying because of that.
Great article! Good overview of the business and it makes me ever more interested in the company. I will to add in the coming weeks at those levels. Thanks!
Thank you, Kostis! I am glad to hear you found some value in this one.
The biggest risk at all times for AXP is a recession with rising unemployment and negative economic growth, as this would lead to fewer transactions and likely some credit risks, although AXP's high-end customer base shouldn't be overly affected.
However, as a recession grows more likely, this could pressure valuation multiples, not the business itself, in the long term. However, we have already seen some of this happen in recent weeks, so some of this negativity is priced in now.
Using 5yr avg multiple isn’t always useful given odd multiples during Covid - if you strip out 2020 & 2021 it’s trading more in line with historical
Great article! I bought this last year when you recommended at $225 and was considering adding last week but was concerned about a recession. Is this still a good buy price if a recession looms?
Yes, I still like this price, even though a recession looms. I think a lot has been priced in already, and AmEx should be somewhat well-positioned. Of course, if we see some panic selling amid growing unemployment and other factors, we could see lower prices, but I wouldn't hold off on buying because of that.
Great article! Good overview of the business and it makes me ever more interested in the company. I will to add in the coming weeks at those levels. Thanks!
Good to hear that!! I am really liking these prices.
Hello , very good article, really enjoyed it and learned got an insight about the business.
The business model is unique and great in my opinion.
Just a question if you can provide some insight, where do you think their greater risk(s) derives from?
What could it be that could ,not hurt the business model, as I do think they have their seat in the industry, maybe affect their valuation negatively?
Thank you very much , really enjoyed it for a company that although not so"in fashion" as others really has proved great compounder.
Best regards Kostis
Thank you, Kostis! I am glad to hear you found some value in this one.
The biggest risk at all times for AXP is a recession with rising unemployment and negative economic growth, as this would lead to fewer transactions and likely some credit risks, although AXP's high-end customer base shouldn't be overly affected.
However, as a recession grows more likely, this could pressure valuation multiples, not the business itself, in the long term. However, we have already seen some of this happen in recent weeks, so some of this negativity is priced in now.