AMERICAN EXPRESS CO (AXP) Stock Fundamental Analysis
NYSE:AXP - New York Stock Exchange, Inc. - US0258161092 - Common Stock - Currency: USD
Taking everything into account, AXP scores 4 out of 10 in our fundamental rating. AXP was compared to 53 industry peers in the Consumer Finance industry. There are concerns on the financial health of AXP while its profitability can be described as average. While showing a medium growth rate, AXP is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
In the past year AXP was profitable.
In the past year AXP had a positive cash flow from operations.
Each year in the past 5 years AXP has been profitable.
AXP had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 3.60%, AXP is in the better half of the industry, outperforming 75.00% of the companies in the same industry.
AXP has a Return On Equity of 32.85%. This is amongst the best in the industry. AXP outperforms 96.15% of its industry peers.
AXP has a Return On Invested Capital (3.75%) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.6% | ||
| ROE | 32.85% | ||
| ROIC | 3.75% |
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
Looking at the Profit Margin, with a value of 13.89%, AXP is in the better half of the industry, outperforming 67.31% of the companies in the same industry.
AXP's Profit Margin has been stable in the last couple of years.
AXP's Operating Margin of 17.38% is fine compared to the rest of the industry. AXP outperforms 67.31% of its industry peers.
AXP's Operating Margin has been stable in the last couple of years.
The Gross Margin of AXP (62.61%) is better than 65.38% of its industry peers.
AXP's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.38% | ||
| PM (TTM) | 13.89% | ||
| GM | 62.61% |
OM growth 3Y-8.13%
OM growth 5Y-0.59%
PM growth 3Y-8.95%
PM growth 5Y-1.04%
GM growth 3Y-3.2%
GM growth 5Y-1.9%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so AXP is destroying value.
AXP has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
2.2 Solvency
AXP has an Altman-Z score of 0.86. This is a bad value and indicates that AXP is not financially healthy and even has some risk of bankruptcy.
The Altman-Z score of AXP (0.86) is comparable to the rest of the industry.
The Debt to FCF ratio of AXP is 14.43, which is on the high side as it means it would take AXP, 14.43 years of fcf income to pay off all of its debts.
AXP's Debt to FCF ratio of 14.43 is in line compared to the rest of the industry. AXP outperforms 40.38% of its industry peers.
AXP has a Debt/Equity ratio of 6.41. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of AXP (6.41) is worse than 80.77% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 6.41 | ||
| Debt/FCF | 14.43 | ||
| Altman-Z | 0.86 |
ROIC/WACC0.52
WACC7.27%
2.3 Liquidity
AXP has a Current Ratio of 0.71. This is a bad value and indicates that AXP is not financially healthy enough and could expect problems in meeting its short term obligations.
AXP has a Current ratio of 0.71. This is comparable to the rest of the industry: AXP outperforms 42.31% of its industry peers.
A Quick Ratio of 0.71 indicates that AXP may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.71, AXP is in line with its industry, outperforming 42.31% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.71 | ||
| Quick Ratio | 0.71 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 19.09% over the past year.
AXP shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 10.27% yearly.
AXP shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 9.58%.
The Revenue has been growing by 9.69% on average over the past years. This is quite good.
EPS 1Y (TTM)19.09%
EPS 3Y10.15%
EPS 5Y10.27%
EPS Q2Q%16.03%
Revenue 1Y (TTM)9.58%
Revenue growth 3Y18.7%
Revenue growth 5Y9.69%
Sales Q2Q%8.73%
3.2 Future
AXP is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 8.30% yearly.
Based on estimates for the next years, AXP will show a small growth in Revenue. The Revenue will grow by 7.66% on average per year.
EPS Next Y15.81%
EPS Next 2Y15.27%
EPS Next 3Y15.31%
EPS Next 5Y8.3%
Revenue Next Year8.68%
Revenue Next 2Y8.46%
Revenue Next 3Y8.1%
Revenue Next 5Y7.66%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 22.13, which indicates a rather expensive current valuation of AXP.
Based on the Price/Earnings ratio, AXP is valued a bit more expensive than 67.31% of the companies in the same industry.
AXP's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 29.63.
With a Price/Forward Earnings ratio of 19.11, AXP is valued on the expensive side.
Based on the Price/Forward Earnings ratio, AXP is valued a bit more expensive than the industry average as 65.38% of the companies are valued more cheaply.
AXP's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 22.68.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.13 | ||
| Fwd PE | 19.11 |
4.2 Price Multiples
AXP's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. AXP is cheaper than 63.46% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, AXP is valued a bit more expensive than the industry average as 65.38% of the companies are valued more cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.72 | ||
| EV/EBITDA | 15.82 |
4.3 Compensation for Growth
AXP's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
AXP has a very decent profitability rating, which may justify a higher PE ratio.
AXP's earnings are expected to grow with 15.31% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.4
PEG (5Y)2.16
EPS Next 2Y15.27%
EPS Next 3Y15.31%
5. Dividend
5.1 Amount
With a yearly dividend of 0.91%, AXP is not a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 4.09, AXP has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.29, AXP's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.91% |
5.2 History
The dividend of AXP is nicely growing with an annual growth rate of 9.36%!
AXP has been paying a dividend for at least 10 years, so it has a reliable track record.
AXP has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)9.36%
Div Incr Years3
Div Non Decr Years20
5.3 Sustainability
19.91% of the earnings are spent on dividend by AXP. This is a low number and sustainable payout ratio.
AXP's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP19.91%
EPS Next 2Y15.27%
EPS Next 3Y15.31%
295.4
-8.46 (-2.78%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryConsumer Finance
Earnings (Last)
Earnings (Next)
Inst Owners65.26%
Inst Owner Change2.22%
Ins Owners0.1%
Ins Owner Change3.77%
Market Cap207.53B
Analysts68
Price Target317.37 (7.44%)
Short Float %1.47%
Short Ratio3.32
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.91% |
Yearly Dividend2.43
Dividend Growth(5Y)9.36%
DP19.91%
Div Incr Years3
Div Non Decr Years20
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)5.88%
Min EPS beat(2)5.25%
Max EPS beat(2)6.52%
EPS beat(4)3
Avg EPS beat(4)5.41%
Min EPS beat(4)-1.69%
Max EPS beat(4)11.56%
EPS beat(8)5
Avg EPS beat(8)2.03%
EPS beat(12)9
Avg EPS beat(12)4.13%
EPS beat(16)13
Avg EPS beat(16)15.15%
Revenue beat(2)0
Avg Revenue beat(2)-1.85%
Min Revenue beat(2)-2.51%
Max Revenue beat(2)-1.19%
Revenue beat(4)0
Avg Revenue beat(4)-1.71%
Min Revenue beat(4)-2.51%
Max Revenue beat(4)-0.9%
Revenue beat(8)2
Avg Revenue beat(8)0.06%
Revenue beat(12)6
Avg Revenue beat(12)1.43%
Revenue beat(16)9
Avg Revenue beat(16)1.75%
PT rev (1m)6.82%
PT rev (3m)14.95%
EPS NQ rev (1m)1.25%
EPS NQ rev (3m)1.21%
EPS NY rev (1m)1.12%
EPS NY rev (3m)1.24%
Revenue NQ rev (1m)0.08%
Revenue NQ rev (3m)0.05%
Revenue NY rev (1m)0.64%
Revenue NY rev (3m)0.7%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.13 | ||
| Fwd PE | 19.11 | ||
| P/S | 2.95 | ||
| P/FCF | 15.72 | ||
| P/OCF | 13.8 | ||
| P/B | 6.99 | ||
| P/tB | 6.99 | ||
| EV/EBITDA | 15.82 |
EPS(TTM)13.35
EY4.52%
EPS(NY)15.46
Fwd EY5.23%
FCF(TTM)18.79
FCFY6.36%
OCF(TTM)21.41
OCFY7.25%
SpS100
BVpS42.29
TBVpS42.29
PEG (NY)1.4
PEG (5Y)2.16
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.6% | ||
| ROE | 32.85% | ||
| ROCE | 10.1% | ||
| ROIC | 3.75% | ||
| ROICexc | 4.59% | ||
| ROICexgc | 5.08% | ||
| OM | 17.38% | ||
| PM (TTM) | 13.89% | ||
| GM | 62.61% | ||
| FCFM | 18.79% |
ROA(3y)N/A
ROA(5y)N/A
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5YN/A
OM growth 3Y-8.13%
OM growth 5Y-0.59%
PM growth 3Y-8.95%
PM growth 5Y-1.04%
GM growth 3Y-3.2%
GM growth 5Y-1.9%
F-Score6
Asset Turnover0.26
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 6.41 | ||
| Debt/FCF | 14.43 | ||
| Debt/EBITDA | 13.72 | ||
| Cap/Depr | 110.3% | ||
| Cap/Sales | 2.62% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 108.34% | ||
| Profit Quality | 135.24% | ||
| Current Ratio | 0.71 | ||
| Quick Ratio | 0.71 | ||
| Altman-Z | 0.86 |
F-Score6
WACC7.27%
ROIC/WACC0.52
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)19.09%
EPS 3Y10.15%
EPS 5Y10.27%
EPS Q2Q%16.03%
EPS Next Y15.81%
EPS Next 2Y15.27%
EPS Next 3Y15.31%
EPS Next 5Y8.3%
Revenue 1Y (TTM)9.58%
Revenue growth 3Y18.7%
Revenue growth 5Y9.69%
Sales Q2Q%8.73%
Revenue Next Year8.68%
Revenue Next 2Y8.46%
Revenue Next 3Y8.1%
Revenue Next 5Y7.66%
EBIT growth 1Y20.01%
EBIT growth 3Y9.05%
EBIT growth 5Y9.04%
EBIT Next Year45.1%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-28.93%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y-25.62%
OCF growth 3YN/A
OCF growth 5YN/A