Reassessing American Express (AXP) Valuation After Its Recent Share Price Strength

Why American Express Stock Is Back in Focus

American Express (AXP) has quietly extended its long run of solid execution, with shares up about 12% over the past 3 months and roughly 24% over the past year.

See our latest analysis for American Express.

With the share price now around $372.73 and a strong 90 day share price return of 12.27%, investors are leaning back toward American Express, helped by steady spending trends and resilient credit performance. Its 1 year total shareholder return of 24.29% reinforces that momentum.

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Yet with the stock now trading slightly above analyst targets despite healthy high single digit revenue and profit growth, investors must decide whether American Express still offers upside or if the market is already pricing in its future expansion.

Most Popular Narrative: 5% Overvalued

Compared with the last close at $372.73, the most widely followed narrative sees American Express as worth about $354.83, pricing in robust but measured growth.

Robust credit quality and risk management, as demonstrated by industry leading performance in the Fed's stress tests, enable American Express to pursue premium lending strategies and balance sheet growth without a commensurate rise in credit costs, supporting margin expansion and earnings resilience.

Read the complete narrative.

Curious how steady margins, faster top line growth, and a richer earnings multiple all fit together? The narrative connects them, step by step. Want to see how?

Result: Fair Value of $354.83 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, rising competition in premium cards and shifting payment habits toward mobile wallets and BNPL could pressure American Express's growth and margins.

Find out about the key risks to this American Express narrative.

Build Your Own American Express Narrative

If this narrative does not fully match your view, or you would rather dig into the numbers yourself, you can build your own in just a few minutes using Do it your way.

A great starting point for your American Express research is our analysis highlighting 2 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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