As 2011 comes to a close, it's a great time to look back at what happened to the stocks that interest you. By making sure you know the important things that a company accomplished -- as well as the setbacks it experienced -- you can make a better decision about whether it's a smart investment for your portfolio.
Today, let's take a look at American Express (NYSE: AXP ) . The card company has largely fallen out of the spotlight as the tag team of rivals Visa (NYSE: V ) and MasterCard (NYSE: MA ) both have a bigger presence in the credit- and debit-card market. But AmEx has some initiatives that it hopes will get it back in the card game, and so far, investors seem to like what they see. Below, I'll take a closer look at the events that moved shares of American Express this year.
Stats on American Express
| Year-to-Date Stock Return |
12.4% |
| Market Cap |
$55.2 billion |
| 1-Year Revenue Growth |
19.3% |
| 1-Year Profit Growth |
29.5% |
| Dividend Yield |
1.5% |
| CAPS Rating |
*** |
Source: S&P Capital IQ.
Why's American Express up this year?
American Express is more than just its signature card business. The company also has a banking arm that has joined peers like Discover Financial (NYSE: DFS ) in offering top rates to savers.
But cards are where the money is, and so AmEx has been doing its best to make up for lost time. Unlike Visa and MasterCard, AmEx has never had exposure to the debit-card market, which has provided strong growth to its rivals. Yet with Congress going after high debit-card transaction fees that card-issuing banks like Bank of America (NYSE: BAC ) and Citigroup (NYSE: C ) have charged -- not to mention the aborted attempt by B of A and others to charge customers just to have debit cards -- AmEx may well have dodged a bullet by ignoring the space.
New initiatives, though, look poised to take advantage of new trends. Earlier this year, the company said it would offer a prepaid card that will tap into the same market as debit-card users. What sets it apart from rival prepaid providers Green Dot and NetSpend (Nasdaq: NTSP ) , however, is that AmEx charges low fees, giving customers a free ATM transaction every month as well as lacking reload or foreign currency conversion fees.
In addition, AmEx is working to roll out a prepaid electronic wallet, allowing customers to use smartphones to make payments. It has plenty of competition, but just making the move shows that AmEx isn't letting the financial world pass it by. That's a big part of why AmEx did well in 2011 and why it could keep building on its success in years to come.
AmEx isn't the only company that is tapping into a world beyond credit cards. Take a look at this free video to discover why your credit card may soon be absolutely worthless -- and which stocks could benefit from the trend. Click here to see it while it lasts.
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