Value
6.5/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 7.0 |
| P/S | 8.3 |
| Fwd P/E | 7.6 |
| PEG | 5.7 |
| Analyst target | 4.0 |
- ▸Forward P/E: 16.1x
- ▸PEG: 1.32
AXP · Why this verdict
Why American Express (AXP) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results. How we score · Editorial policy
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VerdictHOLD
Overall score6.4/10
ConfidenceMEDIUM
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
American Express is a high-quality credit-services compounder with 36% ROE, 17% margins and a wide moat, valued at a forward P/E of 15.8x. The price of $319.11 is only 3.2% below the $329.17 analyst target and trades below a falling 200-day average, so the reward-to-risk of 0.49 does not justify adding.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
American Express is a high-quality compounder with excellent ROE of 36%, strong margins of 17%, a wide economic moat and a Piotroski score of 8/9. Quality breakdown | ROE should stay above 30% and margins near 17% over the next 12 months. | →Stable |
| CounterReturn on assets scores only 2.7/10 and leverage is meaningful (debt-to-equity 1.7), so the high ROE is partly financing-driven. | ||
The stock trades at a forward P/E of 15.8x with a PEG of 1.32, and earnings growth scores 8.2/10, which is a reasonable price for a quality franchise. Valuation breakdown | Earnings growth should keep the PEG near or below 1.3 over the next 12 months. | ↓Deteriorating |
| CounterRevenue growth scores only 5.3/10, and a PEG above 1.0 leaves little margin of safety if growth slows. | ||
The price of $319.11 is only 3.2% below the $329.17 analyst target against 6.5% downside to the stop, a reward-to-risk of 0.49. Estimated upside | Upside should widen above 10% through a pullback or analyst target increases. | →Stable |
| CounterAnalyst rating scores 7.5/10 and sentiment is positive, so targets may rise and re-open upside. | ||
Price is below a 200-day average with a slope of -2.7% over 30 days, a confirmed downtrend, though MACD is improving and RSI is 57 in a recovery setup. Momentum breakdown | Price should reclaim the 200-day average and the momentum score should rise above 6.5. | ↑Improving |
| CounterA death cross is in place and the 200-day slope is still falling, so the recovery may be a bounce within a larger downtrend. | ||
Leverage is a drag, with a debt-to-equity penalty of -1.0 at 1.7, plus 3 medium concentration risks in the 10-K. Bear case | Debt-to-equity should stay below 2.0 and no concentration risk should escalate. | →Stable |
| CounterLeverage is structural for a card lender funding receivables, and medium-severity risks are standard for a company of this scale. | ||
American Express is a high-quality compounder with excellent ROE of 36%, strong margins of 17%, a wide economic moat and a Piotroski score of 8/9.
→StableQuality breakdown
- Expectation
- ROE should stay above 30% and margins near 17% over the next 12 months.
CounterReturn on assets scores only 2.7/10 and leverage is meaningful (debt-to-equity 1.7), so the high ROE is partly financing-driven.
The stock trades at a forward P/E of 15.8x with a PEG of 1.32, and earnings growth scores 8.2/10, which is a reasonable price for a quality franchise.
↓DeterioratingValuation breakdown
- Expectation
- Earnings growth should keep the PEG near or below 1.3 over the next 12 months.
CounterRevenue growth scores only 5.3/10, and a PEG above 1.0 leaves little margin of safety if growth slows.
The price of $319.11 is only 3.2% below the $329.17 analyst target against 6.5% downside to the stop, a reward-to-risk of 0.49.
→StableEstimated upside
- Expectation
- Upside should widen above 10% through a pullback or analyst target increases.
CounterAnalyst rating scores 7.5/10 and sentiment is positive, so targets may rise and re-open upside.
Price is below a 200-day average with a slope of -2.7% over 30 days, a confirmed downtrend, though MACD is improving and RSI is 57 in a recovery setup.
↑ImprovingMomentum breakdown
- Expectation
- Price should reclaim the 200-day average and the momentum score should rise above 6.5.
CounterA death cross is in place and the 200-day slope is still falling, so the recovery may be a bounce within a larger downtrend.
Leverage is a drag, with a debt-to-equity penalty of -1.0 at 1.7, plus 3 medium concentration risks in the 10-K.
→StableBear case
- Expectation
- Debt-to-equity should stay below 2.0 and no concentration risk should escalate.
CounterLeverage is structural for a card lender funding receivables, and medium-severity risks are standard for a company of this scale.
Per-dimension breakdown
Quality
7.4/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 10.0 |
| ROA | 2.7 |
| Gross margin | 8.4 |
| Op margin | 7.4 |
| Net margin | 8.4 |
| Current ratio | 5.7 |
| Moat | 7.5 |
| Piotroski F | 8.9 |
- ▸Excellent ROE: 36%
- ▸Strong margins: 17%
- ▸Wide economic moat
- ▸Compounder quality: strong returns + growth
Growth
6.8/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 5.3 |
| EPS growth | 8.2 |
Momentum
7.6/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.0 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 8.0 |
| Volume | 5.0 |
- ▸Volume accumulation (rising OBV)
- ▸Above 200-MA but MA slope flat
Sentiment
6.6/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 5.7 |
| Analyst rating | 7.5 |
| Price target | 6.5 |
Insider
5.2/10data confidence 50%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.4 |
- ▸Negligible insider selling — $2,972,920 (0.001% of mkt cap)
Peer rank
5.0/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 2.9 |
| quality rank | 6.0 |
| growth rank | 4.7 |
- ▸Superior ROE vs peers
Technical
3.4/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 0.0 |
| support resistance | 1.2 |
| 52w position | 7.4 |
| gap | 5.0 |
Risk (lower is worse)
6.4/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 8.9 |
| days to cover | 7.6 |
| volatility | 6.8 |
| put call | 7.5 |
| implied vol | 6.8 |
| max pain risk | 3.0 |
| beta | 6.7 |
| debt equity | 3.6 |
- ▸Above max pain $195
- ▸Concentration risks: 3 MED (10-K Item 1A)
Catalyst
6.5/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 6.7 |
| earnings timing | 5.0 |
| surprise avg | 6.2 |
| dividend safety | 8.0 |
| news activity | 8.0 |
- ▸Strong earnings: 3B/1M
How the verdict was assembled
Engine trigger
Maintain position. Not compelling to add more.
Engine technical detail
verdict_path:
L4:PATH_F_HOLDPassed (6)
- MOMENTUM:7.6>=5.5
- INSIDER:OK
- 8K:CLEAN
- EARNINGS_PROXIMITY:86d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-0.1=NEGATIVE
Warning (1)
- DEATH_CROSS:momentum=7.6>=5.0 recovering
Reward-to-Risk
-0.10
Upside
-1.0%
Downside
9.9%
Sizing output
AVOID
SetupMomentum Cont — Trend continuation, RSI 65, MACD bullish
EdgeNo clear edge — No clear edge identified
SuitabilityModerate — Balanced profile
Investment implication
None of the engine's positive-conviction paths (C-quality, D-momentum) triggered — the F-path HOLD reflects balanced signals. Strongest-cleared gate: MOMENTUM:7.6>=5.5. Top dim: Momentum at 7.6; weakest: Technical at 3.4. No conviction either direction.
The strongest dimensions are Momentum at 7.6, Quality at 7.4, and Growth at 6.8; the weakest are Technical at 3.4, Peer rank at 5.0, and Insider at 5.2. The V9 engine flagged 1 failed gate with 1 warning, producing an asymmetric reward-to-risk of -0.10 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1High Quality Wide Moat Compounder
Trip ifROE falls below 25% from current 36%.
- P2Reasonable Valuation Moderate Growth
Trip ifPEG ratio rises above 2.0 from current 1.32.
- P3Thin Upside To Analyst Target
Trip ifUpside to the analyst target falls below 0% as the price rises above $329.17.
- P4Downtrend With Recovery Signs
Trip ifPrice falls below the stop of $305.11 with momentum score below 4.5 from current 5.8.
- P5Leverage And Concentration Risk
Trip ifDebt-to-equity exceeds 2.0 from current 1.7.