--- title: "Dow 30 Earnings: American Express First Quarter Fiscal 2018" description: dow 30, first-quarter earnings, American Express, share earnings of $1.86 a year-over-year gain of 39%, shares moved sharply higher, revenues net of expenses were $9.7 billion, replaced lost business from recent separation from Costco, profit will receive significant boost from tax reform image: https://investor.valueline.com/hubfs/social-suggested-images/iStock-520323271-3.jpg --- [![The Value Line Blog](https://investor.valueline.com/hubfs/VL%20Blog%20Images/vl_blog_header.png)](https://investor.valueline.com/blog) [Stock Highlights](https://investor.valueline.com/blog/topic/stock-highlights) # Dow 30 Earnings: American Express First Quarter Fiscal 2018 April 19, 2018 **American** **Express** ([AXP ](https://research.valueline.com/research#sec=company&sym=AXP)– [Free American Express Stock Report](https://research.valueline.com/api/report?documentID=2185-VL_20180209_VLIS_AXP_66_01-61P3FNGB91LO6UVAH822D6E20K&symbol=AXP)), a Dow-30 component and one of the world's largest issuers of credit cards, has reported March-period financial results. For the quarter, the company achieved share earnings of $1.86, which were above our estimate and represented a year-over-year gain of 39%. Following the news, shares of American Express moved sharply higher in early morning trading. Additional details of the March quarter were, overall, quite positive. Total revenues net of expenses were $9.7 billion, or 12% higher than the previous year's tally. The increase stemmed from higher card member spending, loans, and fees. On the other hand, consolidated expenses climbed 9%, to $6.9 billion, which reflected greater rewards costs. Also, the provision for loan losses expanded 35%, to $775 million. The rise was attributed to the growing loan portfolio and an increase in lending write-off and delinquency rates. That said, credit quality remained high and should not be much of a concern. Looking ahead, we remain bullish in regard to American Express' operations. As the first-quarter profit indicated, management has done a fine job of replacing the lost business from its recent separation from **Costco** ([COST](https://research.valueline.com/research#sec=company&sym=COST)). The company has aggressively implemented marketing endeavors and technology improvements, which should continue to bear fruit. Just as important, the bottom line will receive a significant boost from tax reform. Over the past several years, Amex's tax rate has hovered in the low-to-mid 30's and, for the first quarter, it was just 22%. All told, for 2018, we have increased our share-net estimate by $0.20, to $7.30, which is at the high end of management's guidance ($6.90-$7.30). For 2019, we expect earnings to reach $7.90 per share. As for the stock, after trading lower in 2015 and early in 2016, it has staged a huge comeback. In fact, it has outperformed the broader market over the past year-plus. The surge has, in our opinion, reduced the equity's investment appeal, though AXP still offers decent, risk-adjusted return potential out to 2021-2023. **About The Company:** Established in 1850, [American Express Company](http://www.valueline.com/WorkArea/linkit.aspx?LinkIdentifier=id&ItemID=10637) has grown to become a leading global payments, network, and travel firm. It operates through multiple business segments, including the Global Consumer Group and Global Business-to-Business Group. The company sold its AMEX Life business in October of 1995 and its American Express Bank in February of 2008. In mid-1994, it spun off Lehman Brothers to shareholders and ten years later, did the same with American Express Financial Advisors. — Ian Gendler *At the time of this article’s writing, the author did not have positions in any of the companies mentioned.* [![Register now for our free One Stock to Buy webinar](https://no-cache.hubspot.com/cta/default/2532383/5a80130b-f0ce-4bd8-acbd-f077f2232ec5.png)](https://cta-redirect.hubspot.com/cta/redirect/2532383/5a80130b-f0ce-4bd8-acbd-f077f2232ec5) ### Popular Posts Search Search Blog ### Topics - [Investing 101 (2)](https://investor.valueline.com/blog/topic/investing-101) - [Market Commentary (37)](https://investor.valueline.com/blog/topic/market-commentary) - [Stock Highlights (390)](https://investor.valueline.com/blog/topic/stock-highlights) - [Stock Market Today (2071)](https://investor.valueline.com/blog/topic/stock-market-today) Copyright 2026 Value Line, Inc. All Rights Reserved. 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