American Express (AXP) $300 is a solid buy in uncertain times

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AXP’s biggest positives are

• Its fee income from its credit card network from merchants,.
• Its premium brand which has survived decades
• A premium credit card customer base, which mitigates credit risk from higher income customers. 
• Travel services, and travel branding.
• Global recognition and reach.
• The Buffet Halo.
  
  • A large chunk of its shares are owned by Warren Buffet, which reduces the float available for sale. Many Buffet followers are unlikely to sell this stock, cushioning the fall in bad times.

I don’t see its premium multiple declining, it deserves a higher than average multiple.

American Express too has fallen 20% from its highs, but has performed well with a 14% increase in the past year, 108% increase in 5 years and 396% in the past 10.

This is a solid all - weather buy and hold defensive, 10-12% annual returns + a 1.5% dividend yield are very likely. Can buy and average lower on declines. The big challenge will remain revenue growth at only 9%, which is lower than several more aggressive peers and players, but its earnings growth of over 14-15% a year is higher.

Amex quotes 17x earnings growing at 15% so the valuation is OK, I don’t see it coming down too much from here.

I own stock and continue to accumulate on declines.