High-quality clientele give Amex an edge

Article Excerpt

AMERICAN EXPRESS CO. $100 (New York symbol AXP, Conservative Growth Portfolio, Finance sector; Shares outstanding: 847.0 million; Market cap: $84.7 billion; Price-to-sales ratio: 2.3; Dividend yield: 1.4%; TSINetwork Rating: Average; www.americanexpress.com) is one of the world’s largest issuers of payment cards. As of December 31, 2018, it had 114.0 million cards in use across 130 countries. That’s up 1.1%, from a year earlier. Amex issues both traditional credit cards, which let users carry a balance, and charge cards, which have no pre-set spending limit, but must have their balances paid in full each month. The U.S. accounts for 65% of overall revenue. The company’s revenue fell 4.0% in 2015, from $34.2 billion in 2014 to $32.8 billion. That’s because it lost to Visa the rights to issue Costco cards. Revenue fell again in 2016 to $32.2 billion. Amex acted quickly to replace Costco In response to the loss of Costco, Amex has expanded its spending on rewards and other incentives. That has helped attract new cardholders…

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