Jefferies Comments and Raises Estimates on American Express (AXP) Following Earnings
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Price: $336.00 +1.46%
Rating Summary:
23 Buy, 23 Hold, 3 Sell
Rating Trend:
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Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
23 Buy, 23 Hold, 3 Sell
Rating Trend:
Up
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Jefferies is reaffirming its Hold rating and $50 price target on shares of American Express (NYSE: AXP) following the release of its Q3 results.
The company announced earnings per share totaled $1.03 for the quarter, which was $0.09 ahead of the firm's estimate and $0.07 above the consensus. The firm notes the upside was driven by lower tax rate and provisions as revenues and OpEx was inline with estimates.
During the quarter, all four of the company's billed business segments experienced above average year over year growth. Jefferies believes that growth rates in AXP's billed business will remain in the high single digits to low double digits over the near-term.
With total operating expenses outpacing revenue growth by 5.5 percent over the quarter, the firm reports, "Management indicated that expenses as a percent of income are expected to moderate as revenue growth outpaces expense growth, and the company cuts discretionary spend. The only question that remains is how delicately this can be managed without significantly impairing revenue growth, especially as competition ramps up to attract balances and spend."
Jefferies is raising its FY11 and FY12 EPS estimates from $3.94 and $3.86 to $4.06 and $4.03.
For more ratings news on American Express click here and for the rating history of American Express click here.
Shares of American Express closed at $46.13 yesterday.
The company announced earnings per share totaled $1.03 for the quarter, which was $0.09 ahead of the firm's estimate and $0.07 above the consensus. The firm notes the upside was driven by lower tax rate and provisions as revenues and OpEx was inline with estimates.
During the quarter, all four of the company's billed business segments experienced above average year over year growth. Jefferies believes that growth rates in AXP's billed business will remain in the high single digits to low double digits over the near-term.
With total operating expenses outpacing revenue growth by 5.5 percent over the quarter, the firm reports, "Management indicated that expenses as a percent of income are expected to moderate as revenue growth outpaces expense growth, and the company cuts discretionary spend. The only question that remains is how delicately this can be managed without significantly impairing revenue growth, especially as competition ramps up to attract balances and spend."
Jefferies is raising its FY11 and FY12 EPS estimates from $3.94 and $3.86 to $4.06 and $4.03.
For more ratings news on American Express click here and for the rating history of American Express click here.
Shares of American Express closed at $46.13 yesterday.
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