American Express (NYSE:AXP) Earnings Preview and Analyst Insights

• Analysts have initiated a Buy rating for American Express (NYSE:AXP) with a price target of $289, anticipating strong growth in premium card fees and consumer spending.
• The company is expected to report an 11% growth in net income for 2025, driven by significant growth in net card fees and resilient consumer spending.
• Despite anticipated growth, lower profits are expected from its Global Merchant and Network Services division, with an increase in network volumes during the first quarter.

American Express (NYSE:AXP), a leading global financial services company, is gearing up to release its quarterly earnings on April 17, 2025. Analysts are closely monitoring the company's performance, with Wall Street estimates projecting an earnings per share (EPS) of $3.46 and a revenue of approximately $16.93 billion.

The analysis of American Express (NYSE:AXP) has led to a Buy rating with a price target of $289, underlining strong growth in premium card fees and consumer spending. The company is poised for an 11% growth in net income for 2025, fueled by mid-to-high teens growth in net card fees and resilient consumer spending, surpassing consensus expectations and indicating a positive outlook.

American Express's closed-loop model and premium customer base are considered undervalued by the market, supporting an 18x forward price-to-earnings multiple. The company's P/E ratio is approximately 18.22, showcasing the market's valuation of its earnings, while the price-to-sales ratio stands at about 2.58, reflecting its revenue valuation.

Despite the anticipated growth, AXP is expected to report lower profits from its Global Merchant and Network Services division. However, an increase in network volumes during the first quarter is anticipated. These factors are crucial for investors as the company approaches its Q1 earnings release.

The company's financial leverage is highlighted by a debt-to-equity ratio of approximately 1.69. The enterprise value to sales ratio is around 2.74, and the enterprise value to operating cash flow ratio is approximately 13.64, providing insights into the company's valuation relative to its cash flow. The earnings yield is about 5.49%, offering a perspective on the return on investment.