Investing $1K in Warren Buffett’s Favorite Bank Stocks 10 Years Ago Would Have Netted This Much

Quick Read

• Bank of America (BAC) returned +333.19% over 10 years with $30.5B 2025 net income (+12.45%), trades at 12x earnings. American Express (AXP) returned +491.5% over 10 years at 19x earnings. S&P 500 (SPY) returned +234.52%.

• Bank of America’s deposit base and rising rates, plus American Express’s millennial card growth, drove returns that beat the S&P 500 over a decade.

• The analyst who called NVIDIA in 2010 just named his top 10 AI stocks. Get them here FREE.

American Express (NYSE: AXP) and Bank of America (NYSE: BAC) are two of Warren Buffett’s most enduring financial bets. Both have been cornerstones of Berkshire Hathaway’s portfolio for years, built on his conviction in durable business models, pricing power, and consistent capital returns. Holding either stock is really a story of trusting that thesis through cycles.

Two Very Different Financial Powerhouses

Bank of America spent much of the 2010s recovering from the financial crisis, rebuilding capital and cutting costs under CEO Brian Moynihan. That patience paid off as interest rates rose and the bank’s massive deposit base became a structural advantage. Average deposits topped $2 trillion for the first time in Q4 2025, and net income reached $30.5 billion for full-year 2025, up 12.45% year over year.

American Express leaned into its premium card model and younger cardholders. Gen Z and millennial cardholders now represent 60% of new card acquisitions, and net card fee revenues have grown by double digits for 30 consecutive quarters. The brand’s pricing power has proven remarkably resilient.

READ: The analyst who called NVIDIA in 2010 just named his top 10 AI stocks

What $1,000 Would Be Worth Today

Bank of America

• 1-Year Return

  • Initial Investment: $1,000

  • Current Value: $1,183

  • Total Return: +18.31%

  • S&P 500 (same period): $1,178 (+17.77%)

• 5-Year Return

  • Initial Investment: $1,000

  • Current Value: $1,447

  • Total Return: +44.73%

  • S&P 500 (same period): $1,741 (+74.1%)

• 10-Year Return

  • Initial Investment: $1,000

  • Current Value: $4,332

  • Total Return: +333.19%

  • S&P 500 (same period): $3,345 (+234.52%)

American Express

• 1-Year Return

  • Initial Investment: $1,000

  • Current Value: $1,130

  • Total Return: +12.99%

  • S&P 500 (same period): $1,178 (+17.77%)

• 5-Year Return

  • Initial Investment: $1,000

  • Current Value: $2,211

  • Total Return: +121.1%

  • S&P 500 (same period): $1,741 (+74.1%)

• 10-Year Return

  • Initial Investment: $1,000

  • Current Value: $5,915

  • Total Return: +491.5%

  • S&P 500 (same period): $3,345 (+234.52%)

Note: figures reflect price return only and exclude reinvested dividends, which would push both totals higher, given each company’s consistent dividend growth.

The 10-year story is where both stocks shine. BAC’s recovery turned a $1,000 bet into over $4,300. AXP’s compounding premium model turned it into nearly $6,000, nearly doubling the S&P 500’s return. Over five years, Amex outpaced the market handily while BofA lagged, weighed down by rate uncertainty early in that period.

The Case For and Against Buying Here

Bulls point to the supportive rate environment and climbing NII as reasons to favor BofA. Management guided for 5% to 7% NII growth in 2026, and the stock trades at roughly 12x trailing earnings with a $62.35 analyst consensus price target. Bears cite risks including potential rate declines and credit quality concerns following nonperforming loan increases flagged in Q4.

For Amex, the bull case rests on whether millennial and Gen Z acquisition momentum translates into long-term loyalty. The 2026 guidance calls for 9% to 10% revenue growth and EPS of $17.30 to $17.90. But at roughly 19x trailing earnings, the valuation leaves less margin for error, and a consumer spending slowdown would hit Amex harder than BofA. Both stocks have pulled back sharply year to date. Buffett’s thesis on both hasn’t changed. Analysts remain divided on whether current valuations reflect those long-term fundamentals.

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