American Express

AXP-N

NYSE:AXP

104.60
5.53 (5.58%)
The American Express Company, also known as Amex, is an American multinational financial services corporation headquartered in Three World Financial Center in New York City.
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Analysis and Opinions about AXP-N

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Opinion
Expert
TOP PICK
TOP PICK
January 30, 2020
It has been an incredible grower. Top line is growing 8% and the bottom line even more. They have great dividend growth and trade at a cheap multiple. It is a great place to be. They may be economically sensitive but they make a lot of money from people paying interest on cards. They would be impacted by a slowdown in travel, however. (Analysts’ price target is $140.42)
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American Express (AXP-N)
January 30, 2020
It has been an incredible grower. Top line is growing 8% and the bottom line even more. They have great dividend growth and trade at a cheap multiple. It is a great place to be. They may be economically sensitive but they make a lot of money from people paying interest on cards. They would be impacted by a slowdown in travel, however. (Analysts’ price target is $140.42)
COMMENT
COMMENT
October 9, 2019
She owns Visa instead; it has a stronger growth outlook, especially in Europe. AmEx provides the credit when you use their card whereas Visa and Mastercard provide just the transaction as a bank offers that credit, so the business dynamics are different. She prefers the asset-lite model because it offers higher returns.
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American Express (AXP-N)
October 9, 2019
She owns Visa instead; it has a stronger growth outlook, especially in Europe. AmEx provides the credit when you use their card whereas Visa and Mastercard provide just the transaction as a bank offers that credit, so the business dynamics are different. She prefers the asset-lite model because it offers higher returns.
DON'T BUY
DON'T BUY
September 11, 2019
Within the payment card space, AXP-N has a closed loop network -- they can gather their own customer data on spending and credit use. This allows them to do better target marketing. Someone will probably come in to buy that network in the future he thinks. About 20% of their revenue comes from credit card balances making them susceptible to credit downgrades. He would not step into them now.
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American Express (AXP-N)
September 11, 2019
Within the payment card space, AXP-N has a closed loop network -- they can gather their own customer data on spending and credit use. This allows them to do better target marketing. Someone will probably come in to buy that network in the future he thinks. About 20% of their revenue comes from credit card balances making them susceptible to credit downgrades. He would not step into them now.
BUY WEAKNESS
BUY WEAKNESS
September 3, 2019

Mastercard vs. Visa He owns neither, though they have performed incredibly well. Don't buy them now in this part of the cycle. He likes American Express for its much-lower valuation, and have performed well, too, but buy that only on a big pullback.

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American Express (AXP-N)
September 3, 2019

Mastercard vs. Visa He owns neither, though they have performed incredibly well. Don't buy them now in this part of the cycle. He likes American Express for its much-lower valuation, and have performed well, too, but buy that only on a big pullback.

COMMENT
COMMENT
July 11, 2019

AXP vs. V vs. MA. Wouldn't touch Visa or Mastercard, because they're extremely expensive, unless they have a 50% pullback. But AXP is a whole lot cheaper on price to book. It's the only one with visible upside. But it's bang up against technical resistance at 3.5x book. Hasn't been able to get any further. Visa and Mastercard are a lot more profitable than AXP. AXP has more limited downside.

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AXP vs. V vs. MA. Wouldn't touch Visa or Mastercard, because they're extremely expensive, unless they have a 50% pullback. But AXP is a whole lot cheaper on price to book. It's the only one with visible upside. But it's bang up against technical resistance at 3.5x book. Hasn't been able to get any further. Visa and Mastercard are a lot more profitable than AXP. AXP has more limited downside.

PAST TOP PICK
PAST TOP PICK
July 4, 2019
(A Top Pick Jul 04/18, Up 31%) Continues to like it. Changing how they're looking at the consumer. Millennials don't pay as much attention to the cache of the AmEx brand. Secular growth continues to be strong, but when a recession is on the horizon, he'll probably exit his position. Yield is 1.3%, with 8% growth on that dividend.
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(A Top Pick Jul 04/18, Up 31%) Continues to like it. Changing how they're looking at the consumer. Millennials don't pay as much attention to the cache of the AmEx brand. Secular growth continues to be strong, but when a recession is on the horizon, he'll probably exit his position. Yield is 1.3%, with 8% growth on that dividend.
BUY
BUY
June 21, 2019

AmEx, Visa or Mastercard? They're all great. Visa and MC are pure-play payment processors vs. AmEx which is also the issuing bank. They play on electronic payments with people buying more and more online, but V and MC reaches a wider breadth of customers/users. AmEx still focuses on richer people. V and MC will always have a higher multiple because they're viewed as tech companies. They're all great holds for 5-10 years.

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AmEx, Visa or Mastercard? They're all great. Visa and MC are pure-play payment processors vs. AmEx which is also the issuing bank. They play on electronic payments with people buying more and more online, but V and MC reaches a wider breadth of customers/users. AmEx still focuses on richer people. V and MC will always have a higher multiple because they're viewed as tech companies. They're all great holds for 5-10 years.

COMMENT
COMMENT
January 23, 2019
He just sold it because of its high valuation. Long-term, all the credit card companies will benefit from growing acceptance to credit cards globally. He took profits. Short-term, watch for credit costs and an economic slowdown. (Globally, the world still uses more cash than plastic.)
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American Express (AXP-N)
January 23, 2019
He just sold it because of its high valuation. Long-term, all the credit card companies will benefit from growing acceptance to credit cards globally. He took profits. Short-term, watch for credit costs and an economic slowdown. (Globally, the world still uses more cash than plastic.)
DON'T BUY
DON'T BUY
August 16, 2018

Stock is overvalued right now. It is trading at excessive values now. Starting to see some credit concerns creep in. Be prepared for some volatility.

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American Express (AXP-N)
August 16, 2018

Stock is overvalued right now. It is trading at excessive values now. Starting to see some credit concerns creep in. Be prepared for some volatility.

TOP PICK
TOP PICK
July 4, 2018

It has 13x forward earnings with a 12% growth rate as global consumer spending rises. Digital currency is overtaking cash and cheques as a strong trend. Worldwide, people still use cash over plastic, but this will change--and AmEx will benefit. Last week, they announced a co-branded card with Amazon and $3.4-billion buyback program. He's held this for a long time. (Analysts' price target: $109.27)

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It has 13x forward earnings with a 12% growth rate as global consumer spending rises. Digital currency is overtaking cash and cheques as a strong trend. Worldwide, people still use cash over plastic, but this will change--and AmEx will benefit. Last week, they announced a co-branded card with Amazon and $3.4-billion buyback program. He's held this for a long time. (Analysts' price target: $109.27)

COMMENT
COMMENT
May 24, 2018

Should I buy American Express (AXP-N) or VISA (V-N)? It is like asking if I should buy an ice-cream for my daughter or my son. Ownes both. Basically, toll booth for global spending. There is still more cash out there than plastic out there believe it or not. American Express (AXP-N) seems a little cheaper from a valuation stand point. Amex is a little more value oriented, VISA is a little more growth oriented. Keep both.

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Should I buy American Express (AXP-N) or VISA (V-N)? It is like asking if I should buy an ice-cream for my daughter or my son. Ownes both. Basically, toll booth for global spending. There is still more cash out there than plastic out there believe it or not. American Express (AXP-N) seems a little cheaper from a valuation stand point. Amex is a little more value oriented, VISA is a little more growth oriented. Keep both.

PAST TOP PICK
PAST TOP PICK
October 12, 2017

(A Top Pick Aug 26/16. Up 44%.) Still likes this. It just hit new highs yesterday. Trading at about 15X forward earnings with a 10% growth rate, giving it a 1.5X PEG ratio. 1.5% dividend yield will grow at about 10% a year. They are aiming to lower their profits and rates to entice more merchants to accept its cards, by 2019. Thinks it will continue to do very well, particularly with interest rates moving higher and a possible tax reform.

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American Express (AXP-N)
October 12, 2017

(A Top Pick Aug 26/16. Up 44%.) Still likes this. It just hit new highs yesterday. Trading at about 15X forward earnings with a 10% growth rate, giving it a 1.5X PEG ratio. 1.5% dividend yield will grow at about 10% a year. They are aiming to lower their profits and rates to entice more merchants to accept its cards, by 2019. Thinks it will continue to do very well, particularly with interest rates moving higher and a possible tax reform.

COMMENT
COMMENT
September 20, 2017

MasterCard (MA-N), Visa (V-N) or American Express (AXP-N)? Of the 3, he prefers Visa, the largest of the 3. This one is not a favourable one in his view.

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American Express (AXP-N)
September 20, 2017

MasterCard (MA-N), Visa (V-N) or American Express (AXP-N)? Of the 3, he prefers Visa, the largest of the 3. This one is not a favourable one in his view.

BUY
BUY
January 30, 2017

They lost Costco, which one of their biggest accounts. Once they focus back on their premium products we can see growth. The stock is beaten up after a difficult 2016. She thinks this will be a turn-around story.

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American Express (AXP-N)
January 30, 2017

They lost Costco, which one of their biggest accounts. Once they focus back on their premium products we can see growth. The stock is beaten up after a difficult 2016. She thinks this will be a turn-around story.

TOP PICK
TOP PICK
August 26, 2016

This continues to focus on the lending side of its business, and they are doing a lot of cost cutting initiatives which is going to help shares move higher. Technically, it recently broke its 200 day moving average on the upside, which is very bullish. It has formed a solid recovery from its lows earlier this year. Fundamentally it is reasonably valued, trading at about 12X forward earnings, with an estimated growth rate of 8%-10% in terms of earnings per share. Over the last 5 years, it has delivered an annual dividend growth rate of over 10%, and going forward he expects it to be 8%-9%. Dividend yield of 1.79%.

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American Express (AXP-N)
August 26, 2016

This continues to focus on the lending side of its business, and they are doing a lot of cost cutting initiatives which is going to help shares move higher. Technically, it recently broke its 200 day moving average on the upside, which is very bullish. It has formed a solid recovery from its lows earlier this year. Fundamentally it is reasonably valued, trading at about 12X forward earnings, with an estimated growth rate of 8%-10% in terms of earnings per share. Over the last 5 years, it has delivered an annual dividend growth rate of over 10%, and going forward he expects it to be 8%-9%. Dividend yield of 1.79%.

WAIT
WAIT
July 19, 2016

Got Stopped out of this about a year ago. Felt that the brand was getting a little bit tarnished when Costco (COST-Q) walked away. He would prefer Visa (V-N) instead. They are reporting shortly and he would wait to see how they have done.

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Got Stopped out of this about a year ago. Felt that the brand was getting a little bit tarnished when Costco (COST-Q) walked away. He would prefer Visa (V-N) instead. They are reporting shortly and he would wait to see how they have done.

COMMENT
COMMENT
June 7, 2016

A very good company, but he prefers Visa (V-N), because it has the largest electronic payment system in the world. This will give you some dividend growth, but it won’t be very high.

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A very good company, but he prefers Visa (V-N), because it has the largest electronic payment system in the world. This will give you some dividend growth, but it won’t be very high.

DON'T BUY
DON'T BUY
April 13, 2016

Financial services segment is quite weak right now. Technically this one has a major uphill climb right now. There is a very consistent negative revision cycle for earnings. Prefers Visa (V-N) or MasterCard (MA-N).

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Financial services segment is quite weak right now. Technically this one has a major uphill climb right now. There is a very consistent negative revision cycle for earnings. Prefers Visa (V-N) or MasterCard (MA-N).

DON'T BUY
DON'T BUY
April 6, 2016

It has a bit of an uphill battle to get back to double digit EPS growth. Visa is at 15%. A lot of competition has come through. He prefers other credit card names.

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It has a bit of an uphill battle to get back to double digit EPS growth. Visa is at 15%. A lot of competition has come through. He prefers other credit card names.

COMMENT
COMMENT
December 22, 2015

He fundamentally believes in the company. They have a closed loop network. A great company and well-run. Right now this is not the best stock. Earnings revisions have been down. They lost the Costco exclusive. Right now he would prefer a Visa (V-N) or MasterCard (MA-N). (See Top Picks.)

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American Express (AXP-N)
December 22, 2015

He fundamentally believes in the company. They have a closed loop network. A great company and well-run. Right now this is not the best stock. Earnings revisions have been down. They lost the Costco exclusive. Right now he would prefer a Visa (V-N) or MasterCard (MA-N). (See Top Picks.)

COMMENT
COMMENT
July 22, 2015

The natural reaction in a discussion in this company is that if interest rates rise, are they going to suffer greater credit losses which will inhibit earnings. Probably not because the profile of the average American Express card holder is very positive and tends to be wealthier individuals. He prefers the Visa (V-N), MasterCard (MC-N) group over this company’s model. This one takes on credit risks, while the other 2 are just transaction companies. (See Top Picks.)

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The natural reaction in a discussion in this company is that if interest rates rise, are they going to suffer greater credit losses which will inhibit earnings. Probably not because the profile of the average American Express card holder is very positive and tends to be wealthier individuals. He prefers the Visa (V-N), MasterCard (MC-N) group over this company’s model. This one takes on credit risks, while the other 2 are just transaction companies. (See Top Picks.)

DON'T BUY
DON'T BUY
July 7, 2015

Would be more inclined to play Visa (V-N) in this area, as it is showing better International growth. They are all facing the same headwinds of more competition from online payments. Visa has done a better job even though it is a little bit more expensive. You are better off owning the better grower.

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Would be more inclined to play Visa (V-N) in this area, as it is showing better International growth. They are all facing the same headwinds of more competition from online payments. Visa has done a better job even though it is a little bit more expensive. You are better off owning the better grower.

BUY
BUY
May 4, 2015

Underperformed relative to peer group. AMEX carries a receivable risk whereas Visa and MasterCard do not. He prefers V-N, but has no trouble buying any of them.

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Underperformed relative to peer group. AMEX carries a receivable risk whereas Visa and MasterCard do not. He prefers V-N, but has no trouble buying any of them.

COMMENT
COMMENT
January 28, 2015

Thinks we are in the late stages in the market, and he is not sure that you want to own any large caps trading at 14X earnings with a pretty small dividend yield. He would be very cautious on this. These things can go down a lot in a correction. Yield of 1.25% and he would stick with the companies that have a better dividend.

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American Express (AXP-N)
January 28, 2015

Thinks we are in the late stages in the market, and he is not sure that you want to own any large caps trading at 14X earnings with a pretty small dividend yield. He would be very cautious on this. These things can go down a lot in a correction. Yield of 1.25% and he would stick with the companies that have a better dividend.

COMMENT
COMMENT
January 27, 2015

This is not growing at the same massive rate that you are seeing with Visa (V-N) and MasterCard (MA-N). The issue is that they want to keep their service level very high and they want to cater to the elite high end customer, so they really have to walk a fine balance between cutting costs. Their mobile initiatives are excellent. They are also doing Optblue, going after the small merchants, which could be very large. Valuation is pretty attractive versus its 2 rivals. Owning all 3 would not be a bad play either.

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American Express (AXP-N)
January 27, 2015

This is not growing at the same massive rate that you are seeing with Visa (V-N) and MasterCard (MA-N). The issue is that they want to keep their service level very high and they want to cater to the elite high end customer, so they really have to walk a fine balance between cutting costs. Their mobile initiatives are excellent. They are also doing Optblue, going after the small merchants, which could be very large. Valuation is pretty attractive versus its 2 rivals. Owning all 3 would not be a bad play either.

SELL
SELL
January 26, 2015

There is multiple compression coming into their space. No one knows how this shakes out. Step aside and wait for the dust to settle. The other two are fine to invest in.

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American Express (AXP-N)
January 26, 2015

There is multiple compression coming into their space. No one knows how this shakes out. Step aside and wait for the dust to settle. The other two are fine to invest in.

COMMENT
COMMENT
November 3, 2014

This company is doing some good things. Last report was very constructive and very good. He prefers Visa (V-N), which doesn't have credit risks and is just a transactional type of business.

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American Express (AXP-N)
November 3, 2014

This company is doing some good things. Last report was very constructive and very good. He prefers Visa (V-N), which doesn't have credit risks and is just a transactional type of business.

COMMENT
COMMENT
August 14, 2014

MasterCard or American Express for a long-term hold? This has this great brand name. Their clientele is much more affluent. The problem with it is that not every place takes it. Trades at a much lower multiple. If he was pushed, he would say that MasterCard is probably the better.

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American Express (AXP-N)
August 14, 2014

MasterCard or American Express for a long-term hold? This has this great brand name. Their clientele is much more affluent. The problem with it is that not every place takes it. Trades at a much lower multiple. If he was pushed, he would say that MasterCard is probably the better.

PAST TOP PICK
PAST TOP PICK
May 6, 2014

(A Top Pick May 1/13. Up 28.06%.) Raised their dividend and 4.4 billion common shares are going to be bought back in the next 12 months. Still a core holding. This correction is a great buying opportunity.

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(A Top Pick May 1/13. Up 28.06%.) Raised their dividend and 4.4 billion common shares are going to be bought back in the next 12 months. Still a core holding. This correction is a great buying opportunity.

COMMENT
COMMENT
April 1, 2014

Visa (V-N) or American Express (AXP-N)? At present she does not hold a credit card company, but it is a group that she is looking at because they have all pulled back close to their 50 day moving average. Visa and MasterCard trade at a much higher multiple (25X forward earnings) but growth rates are arguably stronger than American Express. Between this and Visa she would probably prefer Visa because it is a larger, more dominant player.

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Visa (V-N) or American Express (AXP-N)? At present she does not hold a credit card company, but it is a group that she is looking at because they have all pulled back close to their 50 day moving average. Visa and MasterCard trade at a much higher multiple (25X forward earnings) but growth rates are arguably stronger than American Express. Between this and Visa she would probably prefer Visa because it is a larger, more dominant player.

PAST TOP PICK
PAST TOP PICK
March 31, 2014

(A Top Pick May 1/13. Up 33.01%.) They are making a big effort into the smaller merchant business space where 70% of that business is basically Visa (V-N) and MasterCard (MC-N). Hopes to own this one for a very long time.

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(A Top Pick May 1/13. Up 33.01%.) They are making a big effort into the smaller merchant business space where 70% of that business is basically Visa (V-N) and MasterCard (MC-N). Hopes to own this one for a very long time.

PAST TOP PICK
PAST TOP PICK
February 6, 2014

(A Top Pick May 1/13. Up 26.6%.) Getting a little bit difficult to hold for him. At the end of the day he thinks that MasterCard (MC-N), Visa (V-N) and Discover (DFS-N) are a little bit more interesting. There is no evident reason to Sell at this point. Extremely well managed and they don’t often disappoint.

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American Express (AXP-N)
February 6, 2014

(A Top Pick May 1/13. Up 26.6%.) Getting a little bit difficult to hold for him. At the end of the day he thinks that MasterCard (MC-N), Visa (V-N) and Discover (DFS-N) are a little bit more interesting. There is no evident reason to Sell at this point. Extremely well managed and they don’t often disappoint.

COMMENT
COMMENT
January 10, 2014

Visa (V-N) and MasterCard (MC-N) really do the network and don’t have any exposure to the credit side of things, or whether people pay or default on their bills, whereas this company does. Because of this, you are able to buy this on lower multiples, which is attractive. A great franchise. High ROE’s over time. Valuation at this time keeps her on the sidelines.

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American Express (AXP-N)
January 10, 2014

Visa (V-N) and MasterCard (MC-N) really do the network and don’t have any exposure to the credit side of things, or whether people pay or default on their bills, whereas this company does. Because of this, you are able to buy this on lower multiples, which is attractive. A great franchise. High ROE’s over time. Valuation at this time keeps her on the sidelines.

PARTIAL SELL
PARTIAL SELL
November 20, 2013

She doesn’t hold charge card companies. This one has a phenomenal franchise. Recent results were great. The valuation is the problem with owning it. 17 times earnings is slightly above the historical range. Good momentum on the business side and maybe it gets things going.

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American Express (AXP-N)
November 20, 2013

She doesn’t hold charge card companies. This one has a phenomenal franchise. Recent results were great. The valuation is the problem with owning it. 17 times earnings is slightly above the historical range. Good momentum on the business side and maybe it gets things going.

SELL
SELL
November 13, 2013

This is a good company that is doing good things, but it is fully valued. Earnings and revenue growth haven’t kept up with the price appreciation. If you own, it should be sold because it is really fully valued.

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American Express (AXP-N)
November 13, 2013

This is a good company that is doing good things, but it is fully valued. Earnings and revenue growth haven’t kept up with the price appreciation. If you own, it should be sold because it is really fully valued.

DON'T BUY
DON'T BUY
July 12, 2013

Sold his stock at $65 because he thought it was fully valued. This is a fundamentally different company than Visa (V-N) or MasterCard (MC-N). They actually issue credit cards so therefore they take on credit and default risks and bear the burden of this themselves. If there is softness in the economy, which it looks like we are going to have, you will see defaults go up and you’ll see credit risks going into this company. He would be inclined to own something like Visa or MasterCard.

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Sold his stock at $65 because he thought it was fully valued. This is a fundamentally different company than Visa (V-N) or MasterCard (MC-N). They actually issue credit cards so therefore they take on credit and default risks and bear the burden of this themselves. If there is softness in the economy, which it looks like we are going to have, you will see defaults go up and you’ll see credit risks going into this company. He would be inclined to own something like Visa or MasterCard.

WAIT
WAIT
May 15, 2013

As retail sales improve, the credit card companies will go up. However, they have already been bid up a lot, so thinks they are fully priced now.

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As retail sales improve, the credit card companies will go up. However, they have already been bid up a lot, so thinks they are fully priced now.

TOP PICK
TOP PICK
May 1, 2013

Have a lot of the credit concerns behind them. Theoretically they are dealing in the wealthier segment of the market. In the last 4 years, the have spent any excess capital into their technology. Thinks they are going to make some really big strides in mobile payments, digital processing and that whole area. Yield of 1.34%.

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Have a lot of the credit concerns behind them. Theoretically they are dealing in the wealthier segment of the market. In the last 4 years, the have spent any excess capital into their technology. Thinks they are going to make some really big strides in mobile payments, digital processing and that whole area. Yield of 1.34%.

COMMENT
COMMENT
October 24, 2012

This is a different model from MasterCard (MC-N) and Visa (V-N). This is a charge card and the others are credit cards. The other 2 have done quite a bit better than this one.

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American Express (AXP-N)
October 24, 2012

This is a different model from MasterCard (MC-N) and Visa (V-N). This is a charge card and the others are credit cards. The other 2 have done quite a bit better than this one.

DON'T BUY
DON'T BUY
March 12, 2012
Credit card companies have had a big run and Visa has done spectacularly. We are seeing a decrease in savings rate in US again. People are paying down their credit cards with lines of credit, which is not a net reduction in personal debt. Going into next year you are going to start to see a fiscal drag on the economy. That is a big market for the credit card companies. Fewer transactions and more delinquencies. Don’t go into this space.
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