American Express Company (AXP): A Bull Case Theory

We came across a bullish thesis on American Express Company (AXP) on Substack by Max Dividends and Serhio MaxDividends. In this article, we will summarize the bulls’ thesis on AXP. American Express Company (AXP)'s share was trading at $296.17 as of May 20^th. AXP’s trailing and forward P/E were 20.68 and 19.57 respectively according to Yahoo Finance.

In a volatile 2025 market environment, American Express (AXP) has emerged as a premier dividend growth stock, blending its 175-year legacy with a future-focused strategy that appeals to both institutional investors and long-term shareholders. Distinguished by its integrated business model and premium customer base, AmEx ranks fourth globally in transaction volume behind UnionPay, Visa, and Mastercard but stands apart with its focus on high-margin, recurring revenue streams rather than riskier lending.

This approach has earned the endorsement of Warren Buffett’s Berkshire Hathaway, which holds a 21% stake, and supports the company’s reputation for operational resilience and consistent capital returns. While its dividend yield currently stands at 1.1%, AmEx has delivered a 120% cumulative dividend increase over the past decade and raised its payout by 17% in 2025. Complementing this shareholder-friendly policy is an aggressive buyback program that has reduced shares outstanding by 30% since 2015, further enhancing per-share value. In 2024, AmEx reported $60.5 billion in revenue and $9.1 billion in net income, with a return on equity surpassing 30%, and its 2025 outlook calls for 8%–10% revenue growth and EPS between $15.00 and $15.50.

A key growth driver is the expanding influence of Millennials and Gen Z, who now represent 42% of its customer base and 75% of new premium card acquisitions, fueling spending in travel and dining—areas up 18% year-over-year. AmEx continues to adapt through merchant expansion, digital innovation, and flexible payment tools like “Plan It,” helping to fend off fintech and BNPL competition. With strong institutional backing and bullish analyst sentiment, AmEx offers both dependable income and long-term upside potential. Also, check out what we found about Visa (V).

American Express Company (AXP) is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 71 hedge fund portfolios held AXP at the end of the fourth quarter which was 62 in the previous quarter. While we acknowledge the risk and potential of AXP as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than AXP but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

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Disclosure: None. This article was originally published at Insider Monkey.