American Express Company (AXP), headquartered in New York, operates as an integrated payments company. With a market cap of $206 billion, the company’s principal products and services are charge and credit payment card products and travel-related services offered to consumers and businesses around the world.

Companies worth $200 billion or more are generally described as “mega-cap stocks,” and AXP definitely fits that description, with its market cap exceeding this threshold, reflecting its substantial size, influence, and dominance in the credit services industry. AXP's strength lies in its integrated payments platform, allowing for direct relationships with customers and merchants. This unique position enables the company to gather valuable transaction data for personalized services and tailored marketing efforts. With a reputation for premium quality and customer service, AXP attracts high-spending clients and maintains a loyal customer base. Its focus on innovation and customer experience is reflected in its digital services and customer care, appealing to Millennials and Gen Z.

Despite its notable strength, AXP slipped 9.9% from its 52-week high of $326.28, achieved on Jan. 23. Over the past three months, AXP stock declined 2.3%, underperforming the Nasdaq Composite’s ($NASX) 1.4% gains during the same time frame.

In the longer term, shares of AXP fell marginally on a YTD basis, underperforming NASX’s 1% dip over the same time frame. However, AXP climbed 23.9% over the past 52 weeks, outperforming NASX’s 12.3% return over the last year.

To confirm the bullish trend, AXP is trading above its 50-day and 200-day moving averages since early May.

AXP’s outperformance can be attributed to its success in capturing a younger demographic, with Millennials and Gen Z customers accounting for 35% of its U.S. consumer services business. The company's strong risk management and focus on affluent customers have helped maintain delinquency ratios at 1.3% and net write-offs at 2.1%. Additionally, higher interest rates are expected to boost net interest income on credit card loans. AXP’s premium brand, loyal customer base, and strong fundamentals position it well for continued success in volatile economic conditions.

On Apr. 17, AXP reported its Q1 results, and its shares closed down by 3.5% in the following trading session. Its EPS of $3.64 surpassed Wall Street expectations of $3.45. The company’s revenue was $16.97 billion, missing Wall Street forecasts of $17 billion. AXP expects full-year EPS in the range of $15 to $15.50.

In the competitive arena of credit services, Visa Inc. (V) has taken the lead over AXP, showing resilience with a 15.6% uptick on a YTD basis and a solid 34.8% gain over the past 52 weeks.

Wall Street analysts are moderately bullish on AXP’s prospects. The stock has a consensus “Moderate Buy” rating from the 29 analysts covering it, and the mean price target of $298.96 suggests a potential upside of 1.7% from current price levels.