Check this if you are still holding on to American Express (NYSE:AXP)

American Express Free Cash Flow is very stable at the moment as compared to the past year. American Express reported last year Free Cash Flow of 4.11 Billion. As of 22nd of October 2021, Invested Capital is likely to grow to about 224.3 B, while Interest Coverage is likely to drop 890.58. One of the important factors of profitable assets selection is to know the future growth potential of an asset before buying its shares. This post will recap American Express. We will evaluate why we are still confident in anticipation of a recovery. The entity responds to the market. We can now focus on American as a potential investment option for your portfolios.
Published over a year ago
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Reviewed by Gabriel Shpitalnik

Macroaxis provides advice on American Express to complement and cross-verify current analyst consensus on American Express. Our investment recommendation engine determines the company's potential to grow exclusively from the perspective of an investor's current risk tolerance and investing horizon.
Typically, a company's financial statements are the reports that show the financial position of the company. There are three main documents that fall into the category of financial statements. These documents include American Express income statement, its balance sheet, and the statement of cash flows. Potential American Express investors and stakeholders use financial statements to determine how well the company is positioned to perform in the future. Although American Express investors may use each financial statement separately, they are all related. The changes in American Express's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on American Express's income statement, which results in the company's gains or losses. Cash flows can provide more information regarding cash listed on a balance sheet, but not equivalent to net income shown on the income statement. Please read more on our technical analysis and fundamental analysis pages.
The goal of American Express fundamental analysis is to do accurate financial forecasts. There are several possible objectives to fundamental analysis, such as projecting of American Express performance into the future periods or doing a reasonable stock valuation. The intrinsic value of American Express shares is the value that is considered the true value of the share. If the intrinsic value of American is higher than its market price, buying is generally recommended. If it is equal to the market price, it is recommended to hold; and if it is less than the market price, then one should sell all shares American Express. Please read more on our fundamental analysis page.

How effective is American Express in utilizing its assets?

American Express reports assets on its Balance Sheet. It represents the amount of American resources that either has an existing economic value or will provide some form of benefits in the future. By effectively utilizing its assets, American Express aims to generate revenue, control costs, drive operational efficiency, and enhance profitability. Optimizing asset utilization helps maximize shareholder value and maintain a competitive position in the Consumer Finance space. To get a better handle on how balance sheet or income statements item affect American volatility, please check the breakdown of all its fundamentals.

Are American Express Earnings Expected to grow?

The future earnings power of American Express involves the interaction of many company-specific, industry, and economic forces. Earnings estimates embody investors' opinions of American Express factors such as sales growth, product demand, competitive industry environment, profit margins, and cost controls. American Express stock prices adjust as these expectations change or are proven wrong. The main thing to remember is that equities with high expected earnings growth tend to underperform the market because it is usually difficult to meet the market's high expectations. Companies with low earnings expectations tend to do better than expected. Please use our latest analysis of American expected earnings.

And What about dividends?

A dividend is the distribution of a portion of American Express earnings, decided and managed by the company's board of directors and paid to a class of its shareholders. Note, announcements of dividend payouts are generally accompanied by a proportional increase or decrease in a company's stock price. American Express dividend payments follow a chronological order of events, and the associated dates are important to determine the shareholders who qualify for receiving the dividend payment. American one year expected dividend income is about USD1.69 per share.
At this time, American Express' Dividend Yield is relatively stable compared to the past year. As of 03/28/2024, Dividend Payout Ratio is likely to grow to 0.37, though Dividends Paid is likely to grow to (1.7 B).
Last ReportedProjected for 2024
Dividends Paid-1.8 B-1.7 B
Dividend Yield 0.01  0.02 
Dividend Payout Ratio 0.21  0.37 
Dividend Paid And Capex Coverage Ratio 85.53  89.80 
Investing in dividend-paying stocks, such as American Express is one of the few strategies that are good for long-term investment. Ex-dividend dates are significant because investors in American Express must own a stock before its ex-dividend date to receive its next dividend.
This type of analysis is very useful when you want to generate a past dividend schedule and payout information for American Express. Then that information in the form of graph and calendar can be used to fully explain how Du Pont dividends can provide a real clue to its valuation.

American Express Gross Profit

American Express Gross Profit growth is one of the most critical measures in evaluating the company. The Gross Profit growth rate is calculated simply by comparing American Express previous period's values with its current period's values. Each time period you're measuring should be of equal lengths the increase or decrease, in a company's Gross Profit between two periods. Here we show American Express Gross Profit growth over the last 10 years. Please check American Express' gross profit and other fundamental indicators for more details.

Details

Institutional investors typically avoid acquiring a high percentage of American Express stocks because performing such an act may violate securities laws. They are usually not investing their own money, but rather making investments on behalf of their clients. Let's take a look at how the ownership of American is distributed among investors.

Ownership Allocation

American Express holds a total of eight hundred three million three hundred thousand outstanding shares. The majority of American Express outstanding shares are owned by other corporate entities. These outside corporations are usually referred to as non-private investors looking to acquire positions in American Express to benefit from reduced commissions. Consequently, institutional investors are subject to a different set of regulations than regular investors in American Express. Please pay attention to any change in the institutional holdings of American Express as this could imply that something significant has changed or about to change at the company. Please note that no matter how much assets the company secures, if the real value of the firm is less than the current market value, you may not be able to make money on it.
Retail Investors
12.68%
Institutions
87.21%
Retail Investors12.68
Insiders0.11
Institutions87.21
 2020 2021 (projected)
Current Assets76 B69.11 B
Total Assets191.37 B197.84 B

Our perspective of the recent American Express roll up

Recent Total Risk Alpha is up to -0.01. Price may decline again. American Express has relatively low volatility with skewness of 0.18 and kurtosis of 0.11. However, we advise all investors to independently investigate American Express to ensure all accessible information is consistent with the expectations about its upside potential and future expected returns. Understanding different market volatility trends often help investors to time the market. Properly using volatility indicators enable traders to measure American Express' stock risk against market volatility during both bullying and bearish trends. The higher level of volatility that comes with bear markets can directly impact American Express' stock price while adding stress to investors as they watch their shares' value plummet. This usually forces investors to rebalance their portfolios by buying different stocks as prices fall.

Our Final Takeaway

Although some firms under the credit services industry are still a bit expensive, American Express may offer a potential longer-term growth to insiders. While some insiders may not share our view we believe that the current risk-reward utility is not appealing enough to do any trading. Please use our equity advice module to run different scenarios to ensure your current risk level and investment horizon are fully reflective of your current investing preferences in regards to American Express.

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Editorial Staff

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Vlad Skutelnik do not own shares of American Express. Please refer to our Terms of Use for any information regarding our disclosure principles.

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