American Express Poised to Benefit from Accelerating Card Fee Growth — Barrons.com

What happened

BofA analysts kept a Buy rating on American Express but lowered their price target to $369 from $382, citing card fee growth of 17% that is re-accelerating while variable customer engagement growth is set to slow.

Confirmed

Global impact / market context

Card fees are revenue American Express earns from its cards, and faster growth there can support earnings even as customer engagement slows. The analysts' 2028 profit estimate implies they see gains ahead, though the lower price target signals reduced expectations.

Analyst inference

American Express is down 14.8% this year, and the company also plans to cut about 5% of its global workforce to become more agile and efficient. Those job cuts could lower costs while the stock remains under pressure.

Analyst inference

What to watch

1. American Express reported a 13% gain in adjusted earnings per share and a nearly 9% revenue gain in the third quarter. Watch whether card fee growth near 17% continues. Confirmed
2. The company plans to cut about 5% of its global workforce, which means fewer jobs. Watch whether these cuts lower costs and support profit without hurting customer service or card spending. Proposed
3. Watch variable customer engagement, which tracks customer use of rewards and membership perks. If it slows as expected, slower engagement could reduce card spending and fee revenue ahead of tougher 2027 comparisons. Analyst inference

Evidence

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