Please ensure Javascript is enabled for purposes of website accessibility

American Express Declares New Dividend; Yield Is Just Under 2%

By Eric Volkman – May 8, 2020 at 12:18PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The company is maintaining its $0.43 per share quarterly payout.

It's dividend time at American Express (AXP -1.97%). The credit card and financial services giant's board of directors declared Thursday that the company's upcoming quarterly payout will be $0.43 per share. This will be paid on Aug. 20 to stockholders of record as of July 2, and it yields slightly less than 2% at the most recent closing share price.

That disbursement matches the previous two, the latest of which is scheduled to be paid today. Prior to those dividends, American Express had doled out $0.39 per share.

Hand holding an AmEx gold card while located in a kitchen.

Image source: American Express.

The company is one of the more solid and dependable dividend payers on the market. It has dispensed a quarterly distribution for several decades, and lately, it has tended to raise it by a few cents once annually toward the end of the year. Over the past five years,  payouts have risen steadily from $0.23 per share to the current level.

The company remains in a good financial position, even though it saw a drop in revenue and a more pronounced one in net profit in its most recently reported quarter. Both can be attributed to the economic slowdown caused by the SARS-CoV-2 coronavirus; revenue eroded because of lower spending by "members" (cardholders) at the end of the quarter when stay-at-home measures were widely adopted across the U.S., and nonessential businesses closed.

As for the steeper tumble on the bottom line, this was mainly due to heavier loss provisioning for what is anticipated to be a wave of defaults from customers.

Nevertheless, investors seemed to be cheered by news of the latest dividend. They bid American Express shares up by almost 3.3% on Thursday; the stock ended up outpacing the gains of the top market indexes.

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

American Express Company Stock Quote
American Express Company
$137.79 (-1.97%) $-2.77

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 09/29/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.