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What: Shares of Green Dot (NYSE: GDOT ) got the green light to rally upwards of 10% after a research report from Jefferies claimed that American Express (NYSE: AXP ) was bailing on its competing Bluebird prepaid cards.
So what: The report indicated that American Express was withdrawing its prepaid cards out of Wal-Mart Stores (NYSE: WMT ) , as they didn't receive a warm reception during a program to test the waters. Jefferies analysts acknowledge that they don't have official word, but its channel checks suggest that AmEx is pulling out.
Now what: That helps allay competitive fears for Green Dot, as its exclusive distribution partnership with Wal-Mart comprises the majority of its sales. As the prepaid-card market has grown, larger rivals in financial services like American Express and JPMorgan Chase have been jumping in, putting a lead on smaller companies like Green Dot. If Jefferies turns out right, then this is definitely good news for Green Dot.
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