September is here, and it looks like the Federal Reserve‘s Federal Open Market Committee just might lower its benchmark interest rate again when it meets next week. Many stocks, especially those of companies that are particularly sensitive to interest rates, are already climbing in anticipation.
As a bank and credit card network, American Express (NYSE: AXP) is very sensitive to interest rates. It was a standout stock last year, gaining 58%, and its gains so far this year are roughly in line with the S&P 500. If the federal funds rate gets the expected cut, Amex could benefit in a big way, and its stock could start to outperform again.
American Express is known for its credit and charge cards, but the company has become a lot more than that. It has a large banking segment that works together with its card network to create a closed-loop model, but each segment adds its own unique value to the whole.