Analyst Targets 20% Upside for Surging Dow Stock

AXP stock hit a record high out of the gate

Sep 17, 2018 at 9:37 AM
facebook twitter linkedin


Stephens upgraded American Express Company (NYSE:AXP) to "overweight" from "equal weight," and boosted its price target to $131 from $109 -- a nearly 20% premium to last Friday's close at $109.56. The analyst in coverage waxed optimistic on the financial firm's engagement with merchants, and said its Amex Offers creates "key upside."

Out of the gate, AXP shares are up 0.6% at $110.14 -- a new record high. The Dow stock is up more than 25% since its mid-February year-to-date lows near $87.50, with its 200-day moving average working as a springboard. Plus, today's early pop brings the security's year-to-date lead to almost 11%, and puts it on track for a sixth win in seven sessions.

Nevertheless, analysts remain skeptical of the Dow stock, with the majority of those in coverage maintaining a lackluster "hold" recommendation. Plus, the average 12-month price target of $113.16 is a slim premium to current trading levels.

Options traders have been unusually bearish toward American Express stock, too. The equity's top-heavy 10-day put/call volume ratio of 2.23 at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) ranks in the 90th annual percentile.

Specifically, the weekly 9/28 104-strike put has seen the biggest increase in open interest over this two-week time frame, with nearly 2,600 contracts added. Data from Trade-Alert indicates most of these puts were bought to open last Tuesday, Sept. 11, meaning speculators expect AXP stock to sink back below $104 by expiration at the close next Friday, Sept. 28.

 

Minimize Risk While Maximizing Profits

There is no options strategy like this one, which consistently minimizes risk while maintaining maximum profits. Perfect for traders looking for ways to control risk, reduce losses, and increase the likelihood of success when trading calls and puts. The Schaeffer’s team has over 41 years of options trading success targeting +100% gains on every trade. Rest assured your losses are effectively limited to your initial cost at the time of making your move! Don't waste another second... join us right now before the next trade is released! 

 


 


 
Special Offers from Schaeffer's Trading Partners