American Express (NYSE:AXP) beat on both revenue and earnings per share for their first-quarter earnings release. A slightly lower tax rate did help their numbers. AXP saw an acceleration in revenue during the month of March, a sign of positive momentum heading into the second quarter and seemingly the rest of the year.
Management is hesitant to change the already given guidance. They cite that they are off to a fantastic start, however, that there is still a lot of work to do. Ben finds a margin of safety in AXP that is absent in most other companies due to the conservative guidance.
Solace is found in decreasing marketing expenses. Last quarter, management was telling of the inverse happening in order to reel in customers. This saved money is instead being used toward membership rewards as revenues for the new platinum service do not get realized until September.
Disclosure: I am/we are long AXP.
I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.