I'd opine that some degree of skepticism is warranted, as Costco represented about a tenth of AmEx's global cards in force in 2014, as well as 8% of its total billed business . It could be two or more years before we see AmEx establish itself as a growth company again.
Of course, there are also reasons to believe this dip is an attractive buying opportunity for the long run. With American Express likely to return to its roots by targeting affluent customers with its recognizable gold cards, it could once again build market share with a client base that's largely removed from the economic fluctuations of the U.S. economy. We also can't forget that AmEx thrives by double-dipping in growing economies as both a lender and a payment processor for merchants. So long as the U.S. economy is growing, AmEx has an opportunity to use that double-dip growth potential in its favor.
I certainly wouldn't fault investors here for taking a watch-and-wait approach until after the investor day meeting on March 25, but I don't see anything beyond a few speed bumps that should slow AmEx and its strong brand down over the long term.
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The article This Wall Street Firm Just Took a Swipe at American Express Company originally appeared on Fool.com.
Sean Williams owns shares of Bank of America, but has no material interest in any other companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong , track every pick he makes under the screen name TrackUltraLong , and check him out on Twitter, where he goes by the handle @TMFUltraLong .The Motley Fool owns shares of, and recommends Costco Wholesale, Bank of America, and Apple. It also recommends American Express. Try any of our Foolish newsletter services free for 30 days . We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy .
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