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American Express vs. Mastercard: Which Is the Better Payments Stock to Buy?

These payments stocks trade at very different valuations. Here's why.

By Matt Frankel, CFP and Tyler Crowe – Aug 30, 2024 at 6:11AM EST

On the surface, American Express (AXP 0.55%) looks like a very cheap stock, at least relative to major payment network company Mastercard (MA 0.92%). In this video, Fool.com contributors Matt Frankel, CFP®, and Tyler Crowe take a closer look to explain why the valuation gap exists and what investors need to know.

*Stock prices used were the morning prices of Aug. 22, 2024. The video was published on Aug. 24, 2024.

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About the Author

Matt Frankel, CFP
Matt Frankel, CFP, is a contributing Motley Fool stock market analyst specializing in the real estate and financial sectors. Prior to The Motley Fool, Matt taught high school and college mathematics. He holds a bachelor’s degree in physics from the University of South Carolina, a master’s degree in mathematics from Nova Southeastern University, and a graduate certificate in financial planning from Florida State University. He won a SABEW award for coverage of the 2017 Tax Cuts and Jobs Act. He is also regularly interviewed by Cheddar, Globe St, The National Desk, and other TV networks and publications for his real estate, financial, stock market, and investing expertise.
TMFMattFrankel
X@MattFrankelCFP

Discover Financial Services is an advertising partner of The Ascent, a Motley Fool company. American Express is an advertising partner of The Ascent, a Motley Fool company. Matt Frankel has positions in American Express. Tyler Crowe has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Mastercard and Visa. The Motley Fool recommends Discover Financial Services and recommends the following options: long January 2025 $370 calls on Mastercard and short January 2025 $380 calls on Mastercard. The Motley Fool has a disclosure policy. Matthew Frankel is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through their link they will earn some extra money that supports their channel. Their opinions remain their own and are unaffected by The Motley Fool.

Stocks Mentioned

American Express Stock Quote
American Express
NYSE: AXP
$329.87
(-0.55%)-$1.82
Mastercard Stock Quote
Mastercard
NYSE: MA
$516.53
(-0.92%)-$4.77
Capital One Financial Stock Quote
Capital One Financial
NYSE: COF
$205.71
(-0.37%)-$0.76
Visa Stock Quote
Visa
NYSE: V
$313.94
(-0.97%)-$3.08

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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