American Express Stock Surges on Strong Earnings, Potential Valuation Reassessment
American Express (AXP) shares rallied sharply after the company reported robust third-quarter results, with revenue climbing 11% year-over-year to $18.4 billion and EPS jumping 19%. The payments giant raised its full-year guidance, projecting 9-10% revenue growth and EPS of $15.20-$15.50.
Unlike pure-play card networks, Amex's vertically integrated model—combining transaction processing with lending and premium card fees—appears to be paying dividends. Cardmember fee income surged 18% as consumers increasingly adopted its high-margin premium products.
The market may be reassessing AXP's valuation potential, with analysts noting room for multiple expansion toward Visa/Mastercard levels if spending growth and credit quality remain stable. This performance underscores how differentiated financial models can create value in payments ecosystems.
