We're Seizing Opportunity to Buy Into Two Positions Poised for a Rebound

Symbol	Transaction Type	# Shares Traded	Recent Price $	Shares Owned After Trade	% Portfolio
AXP	Buy	135	$295	385	2.3%
NOW	Buy	26	$935	198	3.75%

After you receive this alert, we will make the following trades:

Buy 135 shares of American Express AXP at or near $295. Following the trade, the Portfolio will own 385 AXP shares, roughly 2.3% of the Portfolio’s assets.
Buy 26 shares of ServiceNow NOW at or near $935. Following the trade, the Portfolio will own 198 NOW shares, roughly 3.75% of the Portfolio’s assets.

We are once again using pronounced pullbacks in these two positions to build up the Portfolio’s position at better prices than we’ve seen in some time. Because of the improved risk-to-reward tradeoff in both AXP and NOW shares, we are also upgrading their ratings to One from Two.

In the case of ServiceNow, the shares are oversold despite the growing number of signals and other data points for continued cloud adoption and growing AI adoption. Recent and upcoming signals point to Walmart WMT, Carvana CVNA, Booking.com BKNG, McDonald’s MCD and others utilizing AI to enhance productivity and the consumer experience.

With its position across multiple end markets, ServiceNow continues to be a cloud/AI productivity play that should see further margin improvement as AI becomes a larger part of its business mix. The shares being oversold as of Tuesday night is a nice sweetener as is the positive reminder to the market that was Tuesday night’s earnings report from Workday WDAY.

Turning to American Express, comments from Booking.com and others point to continued spending on travel, especially international travel because of the dollar’s strength. We also continue to like the company’s differentiated membership business model with membership fees driving a significant piece of its pre-tax income. Similar to how the membership business model sets Costco COST apart from other retailers, it sets Amex apart from other credit card companies. Earlier this month, we shared that we would be opportunistic with AXP shares should the right opportunity come about, and this move makes good on that.

Two items we will be monitoring closely as they relate to this position are Amex’s 2025 card refresh efforts, which tend to include new benefits that foster membership growth and move up the company’s average fee per card.

Second, last night, the U.S. House passed a budget blueprint that advances President Trump’s tax cut plans, and it appears Senate Republicans are looking for even larger tax cuts. While the details of any final passed bill will of course matter, our thinking is that tax cuts would be a positive to consumer spending, benefitting our positions in AXP shares but also Costco, Amazon AMZN and Mastercard MA.

The House blueprint budget also calls for $300 billion in increased defense and border spending, which if passed, would be positive for our shares of Lockheed Martin LMT and Axon Enterprise AXON.

As we make the NOW trade, we will adjust our panic points to $850 from $900. Our panic point for AXP shares remains for now at $260.

Refreshing our shopping list, we will continue to look for new opportunities, but share we are also keeping a close watch on shares of United Rentals URI and the VanEck Uranium & Nuclear ETF NLR.

More Pro Portfolio:

(Please note that we are looking to execute these trades at or near the share price mentioned above. Once the trade is completed, subscribers can see the trade's executed price here. Be sure to toggle the chart to sort by Purchase Date.)

At the time of publication, TheStreet Pro Portfolio was long AXP, NOW, COST, AMZN, MA, LMT, AXON, URI and NLR.