American Express is set to rebound thanks to strong demand for premium credit cards, says BMO

American Express will get a boost as demand for premium cards grows, according to BMO Capital Markets. The bank initiated coverage of the credit card stock with an outperform rating. It also put a $380 price target on shares, suggesting about 24% upside from Thursday's close. "We believe concerns around premium card competition and elevated reinvestment overlook a more important development; namely that AXP's premium ecosystem is still gaining scale as younger cohorts attach to fee-paying products, card-fee revenues compound, and management's reinvestment strategy delivers healthy returns," analyst Andrew Bauch said Friday in a note to clients. "We see AXP as one of the most durable revenue and earnings growth compounders in our coverage." Shares have fallen roughly 17% in 2026 due to concerns over the company's rising operating costs, in addition to fears that macroeconomic and geopolitical uncertainties could curb its cardholders' spending. AXP YTD mountain Shares are down 17% in 2026. However, Bauch said American Express' recent spending on its operations is likely to bolster growth rather than hinder it. "AXP is spending into a flywheel where card fees, retention, engagement, merchant relevance, and closed-loop data reinforce one another, while developing and improving its best-in-class and highly differentiated membership rewards ecosystem," the analyst wrote. He added that those dynamics are expected to "support durable billed business growth upwards of 1-2pts ahead of the Street over the next two years." BMO Capital Markets' call falls in line with consensus on the Street. Of the 32 analysts covering American Express, 17 have a buy or strong buy rating on the stock, while 15 have a hold on it, LSEG data shows.

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