Sustainable Growth Advisers (SGA), an investment management company, released its first-quarter 2026 investor letter for its “Global Growth Strategy.” A copy of the letter can be downloaded here. The SGA Global Growth Portfolio returned -13.6% (Gross) and -13.8% (Net) compared to the MSCI ACWI return of -3.2% and the MSCI ACWI Growth return of -7.7%. AI disruption narratives significantly affected markets in the first two months of the quarter, leading to declines in software, information services, payments, and insurance brokers. In March, geopolitical tensions in the Middle East caused a spike in oil prices, contributing to market volatility and prompting investors to adopt a more cautious stance. The firm believes prioritizing high-quality businesses with strong balance sheets, durable cash flows, and diversified end markets provides resilience against short-term geopolitical shocks. In addition, you can check the Strategy’s top 5 holdings for its best picks for 2026.
In its first-quarter 2026 investor letter, SGA Global Growth Strategy highlighted American Express Company (NYSE:AXP) as a newly added position. American Express Company (NYSE:AXP) is a leading financial services company that operates as an integrated payments company. On June 16, 2026, American Express Company (NYSE:AXP) closed at $340.74 per share. One-month return of American Express Company (NYSE:AXP) was 9.98%, and its shares gained 14.95% over the past 52 weeks. American Express Company (NYSE:AXP) has a market capitalization of $232.49 billion.
SGA Global Growth Strategy stated the following regarding American Express Company (NYSE:AXP) in its Q1 2026 investor letter:
“We initiated a new position in leading global payments and financial services company American Express Company (NYSE:AXP) during the quarter following a break in the stock price driven in part by market concerns around the potential impact of artificial intelligence on white collar employment and the downstream implications for credit card spending which we believe are overblown. We believe these fears created an attractive opportunity to invest in a high-quality, affluent customer base that supports attractive long-term growth. American Express’s differentiated customer base, characterized by higher average spend levels and lower credit risk, supports attractive pricing power with merchants and consumers. The company’s revenues are highly recurring, underpinned by long-standing customer relationships and billings retention in the high 90s, which has historically translated into low churn even during periods of economic stress. From a growth standpoint, American Express has gained market share in the U.S. as its merchant network has reached near parity with Visa and Mastercard and has improved engagement with younger demographics. Internationally, the company’s relatively underpenetrated merchant footprint provides a clear runway for continued billings growth, which has been the fastest-growing part of the business. While near-term concerns include potential pressure on consumer spending and subdued SME trends, credit metrics remain solid and normalized, and the company’s operating leverage should allow it to deliver mid-teen earnings growth over time, even if revenue growth moderates.”
