Saturday, March 20, 2010

American Express Management Meeting Highlights Focus on Rewards and Charge Card Acquisition $AXP

We are Overweight AXP, as we expect the company to be one of the first credit card lenders to emerge from the credit
downturn, supported by its affluent customer base. Charge-offs have declined from a 2Q09 peak of 9.7% to 7.3%
in 4Q09, and we expect improvement to continue in 2010. We expect its customer base and rich rewards offerings to drive up
AmEx’s share of US Personal Consumption from 4.2% in 2009 to 4.8% by 2012 (Exhibit 1). We do not anticipate any interchange
legislation that would materially alter AXP’s business model.


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