AMERICAN EXPRESS CO (AXP) Stock Fundamental Analysis
NYSE:AXP - New York Stock Exchange, Inc. - US0258161092 - Common Stock - Currency: USD
Overall AXP gets a fundamental rating of 4 out of 10. We evaluated AXP against 52 industry peers in the Consumer Finance industry. AXP has a medium profitability rating, but doesn't score so well on its financial health evaluation. AXP is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year AXP was profitable.
AXP had a positive operating cash flow in the past year.
Each year in the past 5 years AXP has been profitable.
In the past 5 years AXP always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 3.59%, AXP is in the better half of the industry, outperforming 73.08% of the companies in the same industry.
AXP's Return On Equity of 32.50% is amongst the best of the industry. AXP outperforms 94.23% of its industry peers.
Looking at the Return On Invested Capital, with a value of 3.70%, AXP is in line with its industry, outperforming 51.92% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for AXP is significantly below the industry average of 10.31%.
The 3 year average ROIC (3.64%) for AXP is below the current ROIC(3.70%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.59% | ||
| ROE | 32.5% | ||
| ROIC | 3.7% |
ROA(3y)3.36%
ROA(5y)3.17%
ROE(3y)30.79%
ROE(5y)28.26%
ROIC(3y)3.64%
ROIC(5y)3.45%
1.3 Margins
The Profit Margin of AXP (13.95%) is better than 63.46% of its industry peers.
AXP's Profit Margin has been stable in the last couple of years.
With a decent Operating Margin value of 17.29%, AXP is doing good in the industry, outperforming 65.38% of the companies in the same industry.
In the last couple of years the Operating Margin of AXP has remained more or less at the same level.
Looking at the Gross Margin, with a value of 61.84%, AXP is in the better half of the industry, outperforming 61.54% of the companies in the same industry.
In the last couple of years the Gross Margin of AXP has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.29% | ||
| PM (TTM) | 13.95% | ||
| GM | 61.84% |
OM growth 3Y-9.36%
OM growth 5Y-1.39%
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
AXP has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for AXP has been reduced compared to 1 year ago.
The number of shares outstanding for AXP has been reduced compared to 5 years ago.
AXP has a worse debt/assets ratio than last year.
2.2 Solvency
AXP has an Altman-Z score of 0.85. This is a bad value and indicates that AXP is not financially healthy and even has some risk of bankruptcy.
AXP's Altman-Z score of 0.85 is in line compared to the rest of the industry. AXP outperforms 59.62% of its industry peers.
AXP has a debt to FCF ratio of 17.60. This is a negative value and a sign of low solvency as AXP would need 17.60 years to pay back of all of its debts.
AXP has a Debt to FCF ratio of 17.60. This is comparable to the rest of the industry: AXP outperforms 42.31% of its industry peers.
A Debt/Equity ratio of 6.38 is on the high side and indicates that AXP has dependencies on debt financing.
The Debt to Equity ratio of AXP (6.38) is worse than 78.85% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 6.38 | ||
| Debt/FCF | 17.6 | ||
| Altman-Z | 0.85 |
ROIC/WACC0.47
WACC7.84%
2.3 Liquidity
A Current Ratio of 0.68 indicates that AXP may have some problems paying its short term obligations.
With a Current ratio value of 0.68, AXP perfoms like the industry average, outperforming 42.31% of the companies in the same industry.
AXP has a Quick Ratio of 0.68. This is a bad value and indicates that AXP is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 0.68, AXP is in line with its industry, outperforming 42.31% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.68 | ||
| Quick Ratio | 0.68 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 12.52% 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.
The Revenue has grown by 8.00% in the past year. This is quite good.
AXP shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 9.69% yearly.
EPS 1Y (TTM)12.52%
EPS 3Y10.15%
EPS 5Y10.27%
EPS Q2Q%9.31%
Revenue 1Y (TTM)8%
Revenue growth 3Y18.7%
Revenue growth 5Y9.69%
Sales Q2Q%7.38%
3.2 Future
Based on estimates for the next years, AXP will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.40% on average per year.
The Revenue is expected to grow by 7.38% on average over the next years.
EPS Next Y15.15%
EPS Next 2Y14.66%
EPS Next 3Y14.55%
EPS Next 5Y10.4%
Revenue Next Year8.12%
Revenue Next 2Y8.07%
Revenue Next 3Y7.91%
Revenue Next 5Y7.38%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 24.02 indicates a rather expensive valuation of AXP.
Based on the Price/Earnings ratio, AXP is valued a bit more expensive than 73.08% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.45, AXP is valued at the same level.
AXP is valuated rather expensively with a Price/Forward Earnings ratio of 18.70.
Based on the Price/Forward Earnings ratio, AXP is valued a bit more expensive than 65.38% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of AXP to the average of the S&P500 Index (21.90), we can say AXP is valued inline with the index average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.02 | ||
| Fwd PE | 18.7 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of AXP is on the same level as its industry peers.
The rest of the industry has a similar Price/Free Cash Flow ratio as AXP.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 20.31 | ||
| EV/EBITDA | 16.03 |
4.3 Compensation for Growth
AXP's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of AXP may justify a higher PE ratio.
A more expensive valuation may be justified as AXP's earnings are expected to grow with 14.55% in the coming years.
PEG (NY)1.59
PEG (5Y)2.34
EPS Next 2Y14.66%
EPS Next 3Y14.55%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.05%, AXP has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 3.66, AXP has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.42, AXP's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.05% |
5.2 History
The dividend of AXP is nicely growing with an annual growth rate of 10.33%!
AXP has paid a dividend for at least 10 years, which is a reliable track record.
AXP has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)10.33%
Div Incr Years3
Div Non Decr Years20
5.3 Sustainability
AXP pays out 20.27% of its income as dividend. This is a sustainable payout ratio.
AXP's earnings are growing around the same pace than its dividend. As long as the earnings growth is kept the dividend growth is sustainable.
DP20.27%
EPS Next 2Y14.66%
EPS Next 3Y14.55%
328.13
+2.52 (+0.77%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryConsumer Finance
Earnings (Last)
Earnings (Next)
Inst Owners65.1%
Inst Owner Change0.26%
Ins Owners0.1%
Ins Owner Change1.9%
Market Cap229.88B
Analysts70.29
Price Target298.72 (-8.96%)
Short Float %1.52%
Short Ratio2.98
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.05% |
Yearly Dividend2.81
Dividend Growth(5Y)10.33%
DP20.27%
Div Incr Years3
Div Non Decr Years20
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)1.57%
Min EPS beat(2)-0.95%
Max EPS beat(2)4.09%
EPS beat(4)3
Avg EPS beat(4)3.73%
Min EPS beat(4)-0.95%
Max EPS beat(4)6.52%
EPS beat(8)6
Avg EPS beat(8)4.72%
EPS beat(12)8
Avg EPS beat(12)2.19%
EPS beat(16)12
Avg EPS beat(16)8.98%
Revenue beat(2)0
Avg Revenue beat(2)-0.84%
Min Revenue beat(2)-0.88%
Max Revenue beat(2)-0.81%
Revenue beat(4)0
Avg Revenue beat(4)-1.35%
Min Revenue beat(4)-2.51%
Max Revenue beat(4)-0.81%
Revenue beat(8)0
Avg Revenue beat(8)-1.64%
Revenue beat(12)4
Avg Revenue beat(12)0.75%
Revenue beat(16)8
Avg Revenue beat(16)1.65%
PT rev (1m)1.7%
PT rev (3m)-6.75%
EPS NQ rev (1m)0.39%
EPS NQ rev (3m)-0.81%
EPS NY rev (1m)0.22%
EPS NY rev (3m)-0.58%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.26%
Revenue NY rev (1m)-0.03%
Revenue NY rev (3m)-0.4%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.02 | ||
| Fwd PE | 18.7 | ||
| P/S | 3.16 | ||
| P/FCF | 20.31 | ||
| P/OCF | 17.33 | ||
| P/B | 7.37 | ||
| P/tB | 7.37 | ||
| EV/EBITDA | 16.03 |
EPS(TTM)13.66
EY4.16%
EPS(NY)17.55
Fwd EY5.35%
FCF(TTM)16.15
FCFY4.92%
OCF(TTM)18.93
OCFY5.77%
SpS103.8
BVpS44.54
TBVpS44.54
PEG (NY)1.59
PEG (5Y)2.34
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.59% | ||
| ROE | 32.5% | ||
| ROCE | 10.41% | ||
| ROIC | 3.7% | ||
| ROICexc | 4.59% | ||
| ROICexgc | 5.09% | ||
| OM | 17.29% | ||
| PM (TTM) | 13.95% | ||
| GM | 61.84% | ||
| FCFM | 15.56% |
ROA(3y)3.36%
ROA(5y)3.17%
ROE(3y)30.79%
ROE(5y)28.26%
ROIC(3y)3.64%
ROIC(5y)3.45%
ROICexc(3y)4.36%
ROICexc(5y)4.08%
ROICexgc(3y)4.66%
ROICexgc(5y)4.41%
ROCE(3y)9.86%
ROCE(5y)9.06%
ROICexcg growth 3Y-4.54%
ROICexcg growth 5Y1.68%
ROICexc growth 3Y-3.59%
ROICexc growth 5Y1.93%
OM growth 3Y-9.36%
OM growth 5Y-1.39%
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 | 6.38 | ||
| Debt/FCF | 17.6 | ||
| Debt/EBITDA | 13.94 | ||
| Cap/Depr | 113.15% | ||
| Cap/Sales | 2.67% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 92.81% | ||
| Profit Quality | 111.59% | ||
| Current Ratio | 0.68 | ||
| Quick Ratio | 0.68 | ||
| Altman-Z | 0.85 |
F-Score6
WACC7.84%
ROIC/WACC0.47
Cap/Depr(3y)107.59%
Cap/Depr(5y)102%
Cap/Sales(3y)2.82%
Cap/Sales(5y)3.22%
Profit Quality(3y)195.73%
Profit Quality(5y)177.62%
High Growth Momentum
Growth
EPS 1Y (TTM)12.52%
EPS 3Y10.15%
EPS 5Y10.27%
EPS Q2Q%9.31%
EPS Next Y15.15%
EPS Next 2Y14.66%
EPS Next 3Y14.55%
EPS Next 5Y10.4%
Revenue 1Y (TTM)8%
Revenue growth 3Y18.7%
Revenue growth 5Y9.69%
Sales Q2Q%7.38%
Revenue Next Year8.12%
Revenue Next 2Y8.07%
Revenue Next 3Y7.91%
Revenue Next 5Y7.38%
EBIT growth 1Y8.05%
EBIT growth 3Y7.6%
EBIT growth 5Y8.16%
EBIT Next Year45.1%
EBIT Next 3Y9.75%
EBIT Next 5YN/A
FCF growth 1Y-24.82%
FCF growth 3Y-2.5%
FCF growth 5Y0.25%
OCF growth 1Y-21.16%
OCF growth 3Y-1.37%
OCF growth 5Y0.61%