April 25, 2012
The following video is part of our "Motley Fool Conversations" series, in which consumer goods editor and analyst Austin Smith discusses topics across the investing world.
In today's edition, Austin discusses four things investors eyeing American Express should keep on their radar. At the top of his list is an "opening" or relaxing of their closed-loop model. Being a closed-loop company has been a key in their success story up until now, but it has also curbed growth a bit. Watching how they manage a slightly more open model now that they have relationships with banks will be key going forward. Mobile payments, changing demographics, and its charge-off rate are three other key trends investors need to keep an eye on. At the end of the day, American Express remains a strong company with a great business model and robust management. The continued shift towards mobile payments should benefit them in the future, and that's just one reason Warren Buffett continues to own AmEx in his Berkshire Hathaway portfolio.
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