American Express (AXP) has just opened Q1 2026 earnings season with a recent run of quarterly numbers that saw revenue move from US$15.3 billion in Q3 2024 to US$17.6 billion in Q4 2025, while basic EPS shifted from US$3.49 to US$3.54 over the same stretch. Over the last twelve months to Q4 2025, trailing revenue reached US$67.0 billion with basic EPS of US$15.40, giving investors a view of how the top and bottom lines are tracking into the new year and outlining expectations around the sustainability of a 16% net margin as the next set of results beds in.

See our full analysis for American Express.

With the headline figures on the table, the next step is to see how these results line up with the dominant bull and bear narratives that have built around American Express over the past year.

Multi year earnings trend holds at 10.9% a year

• Over the past five years, earnings have grown about 10.9% per year, while earnings growth over the last year was 7.1%, showing that recent growth is below the longer term pace.
• Bulls point to this earnings track record as a foundation for future growth, yet the data gives a mixed read:
  • Forecast earnings growth of around 8.3% a year is below both the 10.9% five year history and the wider US market forecast of 16.1%, which limits how aggressive that bullish view can be.
  • Trailing twelve month net income is US$10.7b on revenue of US$66.97b, which supports the idea of solid profitability but not a step change in growth.

On this set of numbers, bulls argue the long term earnings engine is intact while the latest slowdown just sets expectations a bit lower, which is exactly what the 🐂 American Express Bull Case.

16% net margin edges lower from last year

• Net profit margin sits at 16% for the latest twelve months, compared with 16.4% last year, so profitability is still high but slightly compressed.
• Bears focus on this margin pressure alongside rising costs and competition, and the figures give some support to that caution:
  • Rewards expenses are described as rising quickly and forecast revenue growth of 7.6% a year is slower than the US market’s 11%, so absorbing higher costs without further margin pressure may not be straightforward.
  • The equity story still relies heavily on premium cardmembers and travel and entertainment spend, and any weaker spending in those areas would make it harder to hold margins at 16%.

Skeptics warn that a small margin slip today could become more meaningful if spending or rewards costs move the wrong way, which is what the 🐻 American Express Bear Case.

Valuation split between DCF fair value and 20x P/E

• The DCF fair value in the data is US$377.08 versus a current share price of US$314.08 and an analyst price target of US$358.46, while the stock trades on a P/E of about 20x, in line with peers but above the 9.5x US consumer finance industry average.
• Consensus narrative sees this as a balance of upside and risk, and the numbers show why:
  • Trading below the DCF fair value suggests some upside based on that model, yet the premium to the industry P/E implies investors are already paying up relative to many consumer finance names.
  • Forecast revenue growth of 7.6% a year and earnings growth of 8.3% a year are slower than the broader US market forecasts, so the current 20x P/E depends on the market continuing to value earnings quality and brand strength above simple growth rates.

Next Steps

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for American Express on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.

With both optimism and caution in the mix, the real question is where you land. Do not wait too long to test the numbers, weigh the trade offs, and see how the balance of risks and potential rewards looks to you with 3 key rewards and 2 important warning signs

See What Else Is Out There

American Express is balancing a slightly lower 16% net margin and earnings growth forecasts below both its own history and the broader US market.

If that slower growth profile and modest margin compression leave you wanting stronger upside potential, push your research further with the 56 high quality undervalued stocks today.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.