Financial - Credit Services · NYSE
Current Price
$315.64
Intrinsic Value
Use the calculator below to estimate
Run a full DCF analysis on American Express Company with auto-filled fundamentals, adjustable assumptions, and sensitivity heatmap.
American Express Company, together with its subsidiaries, provides charge and credit payment card products, and travel-related services worldwide. The company operates through three segments: Global Consumer Services Group, Global Commercial Services, and Global Merchant and Network Services. Its products and services include payment and financing products; network services; accounts payable expense management products and services; and travel and lifestyle services. The company's products and services also comprise merchant acquisition and processing, servicing and settlement, point-of-sale marketing, and information products and services for merchants; and fraud prevention services, as well as the design and operation of customer loyalty programs. It sells its products and services to consumers, small businesses, mid-sized companies, and large corporations through mobile and online applications, third-party vendors and business partners, direct mail, telephone, in-house sales teams, and direct response advertising. American Express Company was founded in 1850 and is headquartered in New York, New York.
ROIC (TTM)
8.9%
ROE (TTM)
33.9%
FCF Yield
6.65%
Based on trailing twelve-month data, AXP shows a free cash flow per share of N/A and a ROIC of 8.9%, key inputs for stock valuation using the DCF method. The P/FCF ratio of N/A and FCF yield of 6.65% are important context metrics when evaluating AXP's stock valuation relative to peers.
The intrinsic value of AXP depends on assumptions about future growth rate, discount rate (WACC), and terminal value. A DCF model discounts projected free cash flows back to present value — small changes in WACC can shift the estimate by 20% or more, which is why sensitivity analysis is essential.
Whether AXP is undervalued depends on comparing the DCF-derived intrinsic value to the current market price of $315.64. A positive margin of safety (intrinsic value above market price) suggests potential undervaluation, but the degree of confidence depends on the reliability of your growth and discount rate assumptions.
To perform a DCF valuation on American Express Company: (1) Start with the trailing free cash flow per share as the base, (2) project future FCF growth over 5-10 years based on Financial - Credit Services industry trends and company fundamentals, (3) apply a discount rate (WACC) reflecting AXP's risk profile, and (4) add a terminal value for cash flows beyond the projection period.
DCF (Discounted Cash Flow) estimates what a company is worth today based on its future cash generation. For American Express Company, this means projecting how much free cash flow the Financial - Credit Services will produce over the next 5-10 years, then discounting those amounts to today's dollars. AXP's ROIC of 8.9% shows moderate capital returns.
WACC (Weighted Average Cost of Capital) is the discount rate in a DCF model — it reflects the minimum return investors require. For AXP, the capital structure and equity risk premium determine WACC. A 1% increase in WACC typically reduces the intrinsic value by 10-15%.
