Topic: Growth Stocks

The Wall Street Stock Forecaster Hotline – Friday, November 14, 2008

Article Excerpt

AMERICAN EXPRESS CO. $19.99, New York symbol AXP, has received approval to operate as a bank holding company. This will give the company greater access to government-sponsored financial assistance programs. In addition, it will broaden its access to new capital. The change will also let Amex open branches and take deposits, if it wants to. However, the company will probably continue to focus on its credit card and travel businesses, instead of building up a traditional branch network. Meanwhile, Amex aims to improve its profitability with a new restructuring plan. This includes staff cuts and scaling back other spending. These moves will cost Amex between $240 million and $290 million (after-tax), but should save it $1.8 billion in 2009. To put these figures in context, Amex earned $861 million in the three months ended September 30, 2008, down 23.3% from $1.1 billion a year earlier. Per-share earnings fell 21.3%, to $0.74 from $0.94. The slowing economy has increased writedowns of unpaid credit card…