On July 21, during CNBC’s Mad Money program, host Jim Cramer used the daily chart analysis by options trader Bob Lang, founder of Explosive Options, to examine American Express Company (NYSE:AXP). Cramer pointed to the company’s distinct cardholder demographic and high-margin annual fee structure, as he highlighted why the premium card issuer remains a long-time favorite for core portfolio allocations:
Now finally, there’s one that I have been near and dear for as long as I can remember, and that’s American Express. Now, this only has 10% of purchase volume with fewer cards in circulation, but their cardholders tend to spend a lot more money. Plus, they charge fees for their best cards, basically making you pay for access to their generous rewards programs. It’s a fantastic business model. But remember, they do have credit risk.
Business Model Dynamics and Credit Risk Profile
Under Cramer’s framework, American Express occupies a specialized niche compared to rival payment networks Visa Inc. (NYSE:V) and Mastercard Incorporated (NYSE:MA). While Visa controls 60% of cardholders and Mastercard holds 25% to 30%, American Express Company (NYSE:AXP) commands roughly 10% of purchase volume. However, unlike Visa and Mastercard, which operate strictly as neutral tollbooths with zero balance-sheet risk, American Express operates as a direct card issuer. That closed-loop structure allows the company to capture premium annual membership fees and higher per-cardholder spending, though it requires absorbing credit default risk when consumers fall behind on payments.
Bob Lang’s Technical Setup and Cramer’s Earnings Playbook
On the technical side, Cramer highlighted that Lang noted that American Express Company (NYSE:AXP) has shown exceptional relative strength during recent broader market chop. After breaking out above its 200-day moving average in early June, the stock successfully retested that key support level on multiple occasions before surging higher on heavy volume. With the MACD indicator continuing to flash a buy signal, Lang sees a clear path toward $350, with a secondary upside target at its February peak of $370. It is the exact price level where sellers previously emerged. Furthermore, heading into Friday’s quarterly report, Cramer shared Lang’s bullish fundamental outlook on travel demand while offering his own tactical trading playbook for retail investors:
Now, I’ve gotta tell you, in his view, American Express is the best in class. Given that we’ve seen big numbers in travel here, Lang expects that Amex will shoot the lights out when it reports on Friday… I agree with him that this company’s best of breed, but I also want to point out that American Express’ stock, no matter what they seem to report, tends to sell off in response to earnings on that Friday even when the numbers are terrific. Then it gradually finds its footing afterwards and mounts strong rallies in between quarters, which is why I always say, you know, around like 10:30, 11, you might want to buy this one. I’m not kidding. It’s been a good prediction so far.
Here’s What Institutional Ownership and Short Positioning Signals
Wall Street institutions continue to treat American Express Company (NYSE:AXP) as a premier financial holding, backed by long-standing anchor positions from major shareholders like Berkshire Hathaway. The firm owned over 151.6 million shares of the company, worth nearly $45 billion. However, it is worth noting that while the number of hedge fund holders remained the same (83) in Q4 2025 and Q1 2026, the dollar value of their holdings decreased by around $10 billion to $51 billion in Q1.
Wall Street institutions maintain a solid stake in American Express Company (NYSE:AXP), with institutional investors holding 65.24% of total shares according to Refinitiv. On the short side, exchange positioning reflects minimal bearish sentiment, with the stock’s short float sitting at just 2.04% as of June 30, 2026. The combination of strong institutional backing and low short interest underpins the company’s strong investment case.
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