RBC upgrades this credit card stock, says it can rally 25% despite uncertain consumer outlook

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RBC upgrades this credit card stock, says it can rally 25% despite uncertain consumer outlook
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American Express remains better positioned among its consumer finance peers, according to RBC.

RBC is optimistic on American Express despite an uncertain near-term outlook for the U.S. consumer. Analyst Jon Arfstrom upgraded American Express to outperform from sector perform. He increased his price target by $3 to $200, suggesting more than 25% upside from Friday's close. RBC said it has a balanced longer-term outlook on the consumer.

If the measure passes, companies that are more reliant on late fees will be more at risk, according to Arfstrom. The analyst noted he sees a decision on the matter sometime in the fall. American Express' "higher concentrations of super prime and prime customers should drive better than peer losses over the cycle," said the analyst.

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