American Express experienced a price move of 2.77% down last week, potentially influenced by a series of shareholder proposals focused on Diversity, Equity, and Inclusion, discrimination risks, and civil liberties in advertising. These proposals, which the company advised voting against, surfaced amid a broader market decline, with major indexes like the Dow Jones dropping 3.1% and the Nasdaq 2.4% due to economic concerns, such as tariff impacts and rising inflation fears. The proposals put American Express’s DEI initiatives and advertising policies under scrutiny, coinciding with a week where broader market sentiment was influenced by external economic pressures. Despite a strong tech rally led by firms like Nvidia and Palantir, the overall market experienced a downturn for the fourth consecutive week, reflecting in AXP's performance and contrasting its stock movement. These factors contribute to a complex backdrop influencing American Express's shareholder return over this period.
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Over the past five years, American Express has achieved total shareholder returns of 283.46%. This robust performance includes share price appreciation and dividends, indicating substantial value to its investors. In comparison over the past year, AXP has surpassed the broader US market's returns though it underperformed relative to the Consumer Finance industry. Several elements have contributed to this trajectory. American Express’s earnings have grown consistently, with a significant 21.1% increase last year alone. Additionally, a share buyback program worth US$9.15 billion enhanced shareholder value by reducing outstanding shares. The recent dividend increase of 17% further underscores the company's commitment to rewarding shareholders.
Moreover, American Express expanded internationally by collaborating with Alipay, enhancing transaction ease for its cardholders in China. However, the company has faced scrutiny over diversity and executive compensation policies, with recent investor proposals highlighting these issues. Despite these challenges, the company’s sustained profit growth and strategic expansions have played essential roles in its long-term success.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include NYSE:AXP .
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