AXP Stock Earnings: Can the Company Maintain Its Momentum in 2025?

In this article, we will analyze the outlook for AXP stock ahead of its Q2 2025 earnings release, exploring whether the company can maintain its strong momentum through the rest of the year.

American Express Company (NYSE:AXP) is a global integrated payments company operating across the U.S. and international markets. It offers credit cards, banking, payment solutions, and travel related services through segments like U.S. Consumer and Global Merchant Services. The company serves individuals and businesses of all sizes through various digital and direct channels. American Express Company (NYSE:AXP) is set to report Q2 fiscal 2025 earnings on July 18, and expectations are high following a strong first quarter.

Year to date, AXP stock has gained 6.25%, slightly trailing the S&P 500’s return of 7.07% over the same period. AXP’s forward P/E stands at 20.47, which is 85.73% higher than the sector median of 11.02  according to Seeking Alpha. When compared to its own 5 year average P/E of 19.30, the stock is trading at a 6.03% premium, suggesting it may be slightly overvalued both relative to its peers and its historical valuation.

American Express Company (NYSE:AXP) offers a forward dividend yield of 1.05%, with an annual payout of $3.28 per share. The company's payout ratio stands at 21.38%, indicating a conservative approach to dividend distributions relative to earnings. AXP stock has demonstrated solid income growth, boasting a 5 year dividend growth rate of 12.06% and maintaining consistent dividend increases for the past 3 years.

AXP Stock Earnings: Can the Company Maintain Its Momentum in 2025?

American Express Company (NYSE:AXP) Earnings Snapshot

In Q1, the company posted EPS of $3.64, beating estimates by $0.17, and reported $16.97 billion in revenue, slightly above forecasts. The upcoming quarter’s EPS estimate stands at $3.88, with revenue expected to reach $17.70 billion, indicating continued growth in cardholder spending and lending activity.

However, analyst sentiment has been mixed. Over the past 90 days, 7 EPS estimates have been revised upward, while 9 have been revised down, signaling uncertainty around consumer behavior and potential credit risk.

Investors will focus on key metrics such as net interest income, credit loss provisions, and spending trends across travel and business segments. American Express has benefited from strong demand in premium card categories and corporate travel, but rising delinquencies and economic pressure could challenge margins.

The upcoming report will test whether American Express Company (NYSE:AXP) can maintain momentum in a tougher macro environment. A beat on both earnings and guidance could push the stock higher, while any signs of weakness in consumer resilience may trigger downside pressure.

Positive Takeaways during Q1, 2025 for AXP stock

  1. Earnings Beat & Solid Guidance Maintained
    • Q1 EPS of $3.64 beat expectations of $3.47.
    • Full year EPS guidance of $15-$15.50 and revenue growth of 8%-10% reaffirmed, despite macro uncertainties.
  2. Strong New Card Growth and Fee Revenue
    • Added 3.4 million new cards, with 60% from Millennials and Gen Z.
    • Net card fees up 20% YoY, marking the 27th consecutive quarter of double digit fee growth.
  3. Resilient Spending Trends
    • Billed Business grew 7.5% YoY, with solid growth across U.S. affluent consumers, SMEs, and international markets.
    • Goods & Services spending outpaced 2024, and T&E remained stable.
  4. Exceptional Credit Performance
    • Delinquency and write off rates below pre pandemic levels.
    • Low tenure cardholders’ delinquencies are around 30% better than 2019 levels.
  5. Flexible, Diversified Business Model
    • 75% of revenue comes from spend and fees (vs. lending), making AXP less sensitive to credit cycles.
    • Strong ROE of 34% and robust capital position (CET1 at 10.7%).

Risks & Concerns during Q1, 2025 for AXP stock

  1. Macroeconomic Uncertainty
    • Management acknowledges a higher risk environment and guidance is based on a peak unemployment assumption of 5.7%.
  2. T&E Slowdown in Airlines
    • While restaurants and lodging stayed strong, there was a deceleration in airline spend, a potential early sign of pressure in discretionary spending.
  3. SME Exposure to Tariff Risks
    • Management flagged small businesses as vulnerable to rising tariffs or cost pressures, which could impact spend and credit performance.
  4. Higher Rewards Expenses
    • Rewards costs grew 16% YoY due to program changes and normalization of costs post model adjustments.
  5. Spending Trends Flatlining
    • While steady spending growth showed no acceleration in Q1 (Jan-Mar), and the April uptick was marginal. If the economy weakens, momentum could slow.

Analyst Sentiment Mixed for AXP stock Ahead of Q2, 2025 Results

Analyst sentiment on American Express Company (NYSE:AXP) has turned more cautious in the lead up to its Q2 2025 earnings release scheduled for July 18. On July 15, Monness Crespi Hardt downgraded AXP to Neutral from Buy, citing valuation concerns. Analyst Gus Gala noted that AmEx’s forward price to earnings ratio has expanded from approximately 15x at the start of 2024 to over 19.5x, making further upside less compelling. According to Gala, achieving an additional 10% return would require a 21x multiple, well above the company’s historical trading range. While Monness still expects American Express Company (NYSE:AXP) to meet its high teens EPS growth target, supported by a robust loan portfolio and resilient spending among affluent consumers, the firm now sees the risk/reward profile as more balanced. Notably, spending on premium travel is outpacing economy class by double digits at key partner Delta, and restaurant spending trends remain positive.

Meanwhile, RBC Capital reaffirmed its Outperform rating and raised its price target from $310 to $360 on July 14, citing confidence in the American Express Company (NYSE:AXP) long term growth.

Conversely, BTIG analyst Vincent Caintic also raised his price target, from $240 to $277, but maintained a Sell rating. The revision reflects updated forecasts ahead of Q2 results, though BTIG remains skeptical about valuation amid uncertain earnings visibility.

Recent Developments for AXP Stock

On July 15, American Express Company (NYSE:AXP) reported stable delinquency and write off rates for June, with U.S. Consumer Card loans at $92.6 billion and Small Business loans at $30.1 billion, totaling $122.7 billion. The company reclassified $1.6 billion of Amazon related small business loans as held for sale. American Express Company (NYSE:AXP) also announced a major refresh of its U.S. Consumer and Business Platinum Cards, the largest in its history, focused on travel, dining, and lifestyle benefits. Meanwhile, the Federal Reserve maintained American Express Company (NYSE:AXP) Stress Capital Buffer (SCB) at the minimum level of 2.5%, reflecting the company’s strong capital position. This requirement, effective from October 2025 to September 2026, ensures AXP retains sufficient capital to withstand severe economic downturns.

Future Outlook for AXP Stock

According to data sourced from Seeking Alpha, analysts have provided their annual earnings and revenue estimates for American Express Company (NYSE:AXP) through fiscal years 2025 and 2026. For the year ending December 2025, the consensus earnings per share (EPS) estimate stands at $15.24, with forecasts ranging between a low of $14.47 and a high of $15.65. This implies a forward price to earnings (PE) ratio of approximately 20.69, based on current share prices. A total of 26 analysts contributed to this estimate. Looking ahead to fiscal 2026, analysts project EPS to grow to $17.32, with a tighter range of $16.32 to $17.90, translating to a forward PE ratio of 18.20, again based on input from 26 analysts.

In terms of revenue, American Express Company (NYSE:AXP) is expected to generate $71.32 billion in 2025, with estimates ranging from $70.50 billion to $72.11 billion, supported by a forward price to sales (P/S) ratio of 3.10. For 2026, revenue is anticipated to increase to $77.17 billion, with projections spanning from $74.88 billion to $79.06 billion, corresponding to a forward P/S ratio of 2.86. These revenue projections are based on consensus data from 22 analysts.

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Disclaimer: None. The article is originally published on TheRichStocks.com.
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Author Bio

Umar Farooq is the founder of TheRichStocks.com, offering expert insights on U.S. stocks and investment strategies. He has 15+ years of experience with Deloitte, KPMG, and Nasdaq listed companies. His research blends deep analytical expertise with a passion for helping investors make smarter, data driven decisions.

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