AMERICAN EXPRESS CO (AXP) Stock Fundamental Analysis
NYSE:AXP - US0258161092 - Common Stock
315.8 USD
-3.36 (-1.05%)
315.5 USD
-0.3 (-0.09%)
We assign a fundamental rating of 4 out of 10 to AXP. AXP was compared to 53 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
AXP had positive earnings in the past year.
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 each of the past 5 years.
1.2 Ratios
AXP has a Return On Assets of 3.39%. This is in the better half of the industry: AXP outperforms 67.92% of its industry peers.
The Return On Equity of AXP (31.00%) is better than 92.45% of its industry peers.
AXP's Return On Invested Capital of 3.62% is in line compared to the rest of the industry. AXP outperforms 50.94% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for AXP is significantly below the industry average of 10.74%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.39% | ||
| ROE | 31% | ||
| ROIC | 3.62% |
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
AXP's Profit Margin of 13.38% is fine compared to the rest of the industry. AXP outperforms 60.38% of its industry peers.
In the last couple of years the Profit Margin of AXP has remained more or less at the same level.
AXP has a better Operating Margin (17.21%) than 64.15% of its industry peers.
In the last couple of years the Operating Margin of AXP has remained more or less at the same level.
The Gross Margin of AXP (61.37%) is better than 60.38% of its industry peers.
In the last couple of years the Gross Margin of AXP has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.21% | ||
| PM (TTM) | 13.38% | ||
| GM | 61.37% |
OM growth 3Y-8.78%
OM growth 5Y-0.57%
PM growth 3Y-8.37%
PM growth 5Y-0.22%
GM growth 3Y-2.58%
GM growth 5Y-1.09%
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.
AXP has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, AXP has a worse debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 0.82, we must say that AXP is in the distress zone and has some risk of bankruptcy.
AXP's Altman-Z score of 0.82 is in line compared to the rest of the industry. AXP outperforms 56.60% of its industry peers.
AXP has a debt to FCF ratio of 18.84. This is a negative value and a sign of low solvency as AXP would need 18.84 years to pay back of all of its debts.
AXP's Debt to FCF ratio of 18.84 is in line compared to the rest of the industry. AXP outperforms 45.28% of its industry peers.
A Debt/Equity ratio of 6.47 is on the high side and indicates that AXP has dependencies on debt financing.
Looking at the Debt to Equity ratio, with a value of 6.47, AXP is doing worse than 77.36% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 6.47 | ||
| Debt/FCF | 18.84 | ||
| Altman-Z | 0.82 |
ROIC/WACC0.45
WACC7.97%
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.
The Current ratio of AXP (0.71) is comparable to the rest of the industry.
A Quick Ratio of 0.71 indicates that AXP may have some problems paying its short term obligations.
AXP has a Quick ratio (0.71) which is in line with its industry peers.
| 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 11.85% over the past year.
The Earnings Per Share has been growing by 10.27% on average over the past years. This is quite good.
AXP shows a small growth in Revenue. In the last year, the Revenue has grown by 5.28%.
AXP shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 8.79% yearly.
EPS 1Y (TTM)11.85%
EPS 3Y10.15%
EPS 5Y10.27%
EPS Q2Q%16.91%
Revenue 1Y (TTM)5.28%
Revenue growth 3Y17.95%
Revenue growth 5Y8.79%
Sales Q2Q%9.32%
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 Y15.84%
EPS Next 2Y14.28%
EPS Next 3Y13.77%
EPS Next 5Y10.4%
Revenue Next Year8.55%
Revenue Next 2Y8.45%
Revenue Next 3Y8.28%
Revenue Next 5Y7.38%
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 stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 22.16, AXP is valued on the expensive side.
Based on the Price/Earnings ratio, AXP is valued a bit more expensive than 71.70% of the companies in the same industry.
AXP's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.03.
With a Price/Forward Earnings ratio of 18.11, AXP is valued on the expensive side.
69.81% of the companies in the same industry are cheaper than AXP, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 22.63. AXP is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.16 | ||
| Fwd PE | 18.11 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as AXP.
Based on the Price/Free Cash Flow ratio, AXP is valued a bit more expensive than 60.38% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.81 | ||
| EV/EBITDA | 15.09 |
4.3 Compensation for Growth
The 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.
A more expensive valuation may be justified as AXP's earnings are expected to grow with 13.77% in the coming years.
PEG (NY)1.4
PEG (5Y)2.16
EPS Next 2Y14.28%
EPS Next 3Y13.77%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.07%, AXP has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 4.24, AXP has a dividend in line with its industry peers.
With a Dividend Yield of 1.07, AXP pays less dividend than the S&P500 average, which is at 2.34.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.07% |
5.2 History
The dividend of AXP is nicely growing with an annual growth rate of 10.33%!
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)10.33%
Div Incr Years3
Div Non Decr Years20
5.3 Sustainability
AXP pays out 21.24% of its income as dividend. This is a sustainable payout ratio.
The dividend of AXP is growing around the same rate as the earnings are growing. If this keeps up the dividend growth is sustainable.
DP21.24%
EPS Next 2Y14.28%
EPS Next 3Y13.77%
315.8
-3.36 (-1.05%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryConsumer Finance
Earnings (Last)
Earnings (Next)
Inst Owners65.51%
Inst Owner Change-1.76%
Ins Owners0.1%
Ins Owner Change-3.28%
Market Cap219.76B
Analysts68
Price Target324.04 (2.61%)
Short Float %1.69%
Short Ratio3.43
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.07% |
Yearly Dividend2.81
Dividend Growth(5Y)10.33%
DP21.24%
Div Incr Years3
Div Non Decr Years20
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)3.98%
Min EPS beat(2)3.86%
Max EPS beat(2)4.09%
EPS beat(4)3
Avg EPS beat(4)3.06%
Min EPS beat(4)-0.95%
Max EPS beat(4)5.25%
EPS beat(8)6
Avg EPS beat(8)4.96%
EPS beat(12)8
Avg EPS beat(12)2.05%
EPS beat(16)12
Avg EPS beat(16)5.08%
Revenue beat(2)0
Avg Revenue beat(2)-0.49%
Min Revenue beat(2)-0.81%
Max Revenue beat(2)-0.18%
Revenue beat(4)0
Avg Revenue beat(4)-0.76%
Min Revenue beat(4)-1.19%
Max Revenue beat(4)-0.18%
Revenue beat(8)0
Avg Revenue beat(8)-1.2%
Revenue beat(12)3
Avg Revenue beat(12)0.83%
Revenue beat(16)7
Avg Revenue beat(16)2.19%
PT rev (1m)1.87%
PT rev (3m)10.32%
EPS NQ rev (1m)0.22%
EPS NQ rev (3m)-2.48%
EPS NY rev (1m)0.52%
EPS NY rev (3m)0.83%
Revenue NQ rev (1m)-0.01%
Revenue NQ rev (3m)-0.09%
Revenue NY rev (1m)0.4%
Revenue NY rev (3m)0.36%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.16 | ||
| Fwd PE | 18.11 | ||
| P/S | 2.93 | ||
| P/FCF | 19.81 | ||
| P/OCF | 16.78 | ||
| P/B | 6.8 | ||
| P/tB | 6.8 | ||
| EV/EBITDA | 15.09 |
EPS(TTM)14.25
EY4.51%
EPS(NY)17.44
Fwd EY5.52%
FCF(TTM)15.94
FCFY5.05%
OCF(TTM)18.82
OCFY5.96%
SpS107.62
BVpS46.43
TBVpS46.43
PEG (NY)1.4
PEG (5Y)2.16
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.39% | ||
| ROE | 31% | ||
| ROCE | 9.87% | ||
| ROIC | 3.62% | ||
| ROICexc | 4.55% | ||
| ROICexgc | 5.06% | ||
| OM | 17.21% | ||
| PM (TTM) | 13.38% | ||
| GM | 61.37% | ||
| FCFM | 14.82% |
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-8.78%
OM growth 5Y-0.57%
PM growth 3Y-8.37%
PM growth 5Y-0.22%
GM growth 3Y-2.58%
GM growth 5Y-1.09%
F-Score5
Asset Turnover0.25
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 6.47 | ||
| Debt/FCF | 18.84 | ||
| Debt/EBITDA | 14.31 | ||
| Cap/Depr | 115.88% | ||
| Cap/Sales | 2.67% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 89.62% | ||
| Profit Quality | 110.76% | ||
| Current Ratio | 0.71 | ||
| Quick Ratio | 0.71 | ||
| Altman-Z | 0.82 |
F-Score5
WACC7.97%
ROIC/WACC0.45
Cap/Depr(3y)107.59%
Cap/Depr(5y)102%
Cap/Sales(3y)2.77%
Cap/Sales(5y)3.15%
Profit Quality(3y)195.73%
Profit Quality(5y)177.62%
High Growth Momentum
Growth
EPS 1Y (TTM)11.85%
EPS 3Y10.15%
EPS 5Y10.27%
EPS Q2Q%16.91%
EPS Next Y15.84%
EPS Next 2Y14.28%
EPS Next 3Y13.77%
EPS Next 5Y10.4%
Revenue 1Y (TTM)5.28%
Revenue growth 3Y17.95%
Revenue growth 5Y8.79%
Sales Q2Q%9.32%
Revenue Next Year8.55%
Revenue Next 2Y8.45%
Revenue Next 3Y8.28%
Revenue Next 5Y7.38%
EBIT growth 1Y6.08%
EBIT growth 3Y7.6%
EBIT growth 5Y8.16%
EBIT Next Year45.1%
EBIT Next 3Y9.75%
EBIT Next 5YN/A
FCF growth 1Y-25%
FCF growth 3Y-2.5%
FCF growth 5Y0.25%
OCF growth 1Y-20.57%
OCF growth 3Y-1.37%
OCF growth 5Y0.61%