It’s been a tough year for American Express (NYSE: AXP). Shares have fallen 18% in 2026 (as of Oct. 8). The overall market, on the other hand, has advanced 14% this year.
The financial stock currently sits at about $302 per share, which is only 4% above its 52-week low from March. That’s also below the average price of $315.77 that the leadership team paid to repurchase 7.1 million shares during the second quarter.
Missed AI’s “Act 1”? Act 2 Could Be 14x Bigger. Most investors think they missed the AI boat because they didn’t buy Nvidia in 2005. But according to our analysts, we’re only at the end of “Act 1″—the R&D phase. “Act 2” is the global rollout. Continue »
Does this mean that American Express is a smart buying opportunity right now? Here’s how investors should make sense of the situation.
The business buys back shares every quarter
During the three months that ended June 30, American Express spent $2.2. billion in total on stock buybacks. At the end of Q2, the diluted outstanding share count was 3% lower than a year ago. Investors appreciate this trend, as it provides a lift to earnings per share (EPS).
Now that the stock price is below what management paid, astute investors are wondering whether this is a valuable signal that it’s time to add the premium credit card enterprise to their portfolios. The company’s executive team should have a firm grasp of the intrinsic value. Repurchasing shares should be done at attractive stock prices. This suggests that shares could be even more undervalued today.
But it’s important to take a step back and realize that American Express is a perennial share repurchaser. It bought back $1.7 billion worth of stock in the first quarter, after repurchasing $5.3 billion all of last year. During Q4 2025, when the shares reached a record high, the company still spent $899 million repurchasing shares.
The activity does fluctuate. In recent years, buybacks have been highest in the third quarter, with much less repurchasing happening in Q4. In Q3 last year, for instance, American Express spent $2.5 billion buying back stock at its then-all-time high. It’s hard to make any definitive conclusions.
Think about the next five years
I believe investors should spend more time focusing their attention on what the future will bring. Think about American Express through the lens of a potential long-term investment. Although the stock is down 18% this year, the underlying business is still operating at full strength.
The company raised its quarterly dividend in March by 16%. And it maintained 2026 EPS guidance within a range of $17.30 to $17.90, equating to a 14% increase (at the midpoint) year over year. These are signs of a healthy business that’s performing well amid an uncertain macroeconomic environment.
