American Express Shines In Stress Test, Susquehanna 'Meaningfully' Raise 2016 Estimates

In a report published Wednesday, Susquehanna Financial Group analyst James Friedman commented that

"shined" in its Stress Test and a large share repurchase authorization suggests consensus earnings per share estimates may be too low next year. Friedman noted that American Express' 2014 capital plan allowed repurchases of up to $4.4 billion plus an additional $1.0 billion in the first quarter 2015. The analyst added that the company's fiscal 2015 plan includes $6.6 billion of repurchase from the second quarter through the second quarter 2016. Friedman continued that in 2014 the company reduced its overall share count by 3.6 percent. The analyst estimated an "acceleration" in share count reduction of 5.7 percent will occur in fiscal 2015. Bottom line, due to the "big repurchase increase," Friedman is raising his 2015 earnings per share estimate to $5.58 from $5.56 while "meaningfully" increasing his 2016 earnings per share estimates to $5.96 from $5.85. Shares are "Positive" rated with a $99 price target.