The 2016 Bullish and Bearish Case for American Express and Visa

Banking, finance, and taxes

Published: January 7, 2016 10:50 am

Last Updated: January 13, 2020 3:19 pm

The major credit cards of the Dow had a somewhat mixed year with each at opposing ends of the spectrum. Visa Inc. (NYSE: V) was the obvious winner as a card processor, while American Express Co. (NYSE: AXP) went south as a credit card issuer. There were a fair amount of unique factors that precipitated these polar performances, despite both companies residing in the same industry.

Now that 2015 has ended, 24/7 Wall St. wanted to see what the strategists and analysts on Wall Street expect for the stock market and key stocks in 2016.

It turns out the bull market was interrupted in 2015 as the Dow Jones Industrial Average closed out the year at 17,425.03 for a change of -2.2% for the year. That may be hardly a reason to call a bear market ahead, but it is after six straight years of gains.

American Express

While the index performance of the Dow does not account for individual stock dividends, American Express closed out 2015 at $69.55, for a loss of 24.2%, including its dividend adjustments.

For the year ahead, the consensus analyst price target from Thomson Reuters is $80.92. If the analysts are correct, the expected total return for American Express would be 18%, if you include its dividend yield of 1.67%.