American Express Company (AXP): Balancing Dividend Growth With Long-Term Stability

American Express Company (NYSE:AXP) is included among the 11 Best Bank Dividend Stocks to Buy.

American Express Company (NYSE:AXP) is among the oldest bank holding and financial services companies in the US, yet its operations feel modern and tech-driven, appealing strongly to a younger consumer base that could fuel growth for years to come.

A constant for American Express Company (NYSE:AXP) has been its focus on affluent customers. These consumers typically have higher spending power and are more resilient during economic fluctuations. This strategy supports a highly profitable business model: the company collects annual fees on many of its credit cards while offering attractive rewards and perks. These fees contribute significantly to the bottom line and foster customer loyalty, as cardholders tend to renew their accounts year after year.

CEO Stephen Squeri highlighted that American Express Company (NYSE:AXP)’s premium customer base is expanding. Over the past 40 years, the company has built a premium-focused model that is hard to replicate, featuring exclusive benefits such as airport lounges and strong partnerships with luxury brands. This gives the company a competitive advantage in a growing market, and as these customers continue to use its services, the company has significant potential for long-term growth.

In addition, American Express Company (NYSE:AXP)’s dividend history makes it a reliable choice for income investors. The company’s quarterly dividend comes in at $0.82 per share and has a dividend yield of 0.96%, as of September 24.

While we acknowledge the potential of AXP as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.