Using the PEG framework with analyst consensus forward EPS growth of 13.0% plus 1.1% dividend yield, American Express Company has a fair value of $228.27 based on NTM EPS (FY2026) of $17.59. The current PEG ratio is 1.31.
PEG < 1 = bargain, 1–1.5 = fair, > 2 = expensive.
PEG works well for steady growers with predictable earnings.
| EPS Growth RateForward | 11.9% |
| Dividend Yield | +1.1% |
| Adjusted Growth (clamped 8–25%) | 13.0% |
| Fair P/E | 13.0x |
| NTM EPS (FY2026) | $17.59 |
| Fair Value | $228.27 |
| Period | EPS Est. | Growth | Analysts |
|---|---|---|---|
| FY2025 (actual) | $15.38 | — | — |
| FY2026E | $17.59 | +14.4% | 16 |
| FY2027E | $20.13 | +14.4% | 16 |
| FY2028E | $23.07 | +14.6% | 9 |
| FY2029E | $24.87 | +7.8% | 4 |
| FY2030E | $26.95 | +8.4% | 4 |
5Y Forward EPS CAGR: 11.9%
| Year | Net Income | EPS | YoY |
|---|---|---|---|
| FY2021 | $8.1B | $10.02 | — |
| FY2022 | $7.5B | $9.84 | -1.8% |
| FY2023 | $8.4B | $11.21 | +13.9% |
| FY2024 | $10.1B | $14.02 | +25.1% |
| FY2025 | $10.8B | $15.38 | +9.7% |
4Y Historical EPS CAGR: 11.3%
The PEG Fair Value uses the Price/Earnings-to-Growth framework. A stock is fairly valued when its P/E ratio equals its earnings growth rate (PEG = 1.0). This model adds dividend yield to the growth rate per the original PEGY formula.
Growth rate priority: analyst consensus forward EPS CAGR (when ≥ 3 analysts cover the stock), falling back to historical EPS CAGR. Using EPS rather than net income avoids distortion from share buybacks. The growth rate is clamped between 8% and 25% — below 8% would undervalue stable earners, while above 25% would overvalue unsustainable spikes.