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AmEx's (AXP) Tie-Up to Let WebBank Issue Amex Cards Via Fintechs

American Express Company AXP recently joined forces with Utah-based and the well-established digital lending industry player WebBank. The move aimed at allowing the latter to issue Amex cards and subsequently, letting it become a participant on AXP’s network. Later in 2022, WebBank has plans to commence issuance of Amex cards via fintechs.

Through this latest tie-up, WebBank can issue credit card and payment solutions, backed by American Express’ diversified benefits. The product offerings will be extended by WebBank through its strategic partner platforms, which comprise fintechs in addition to retailers, manufacturers and software as a service (SaaS) companies.

The recent initiative highlights two prominent endeavors of American Express. The first one is to bolster the Amex brand reach, while the second one is to extend necessary assistance to fintechs.

Cards bearing the Amex logo are often issued by American Express itself as well as those third-party banks and other financial institutions that are part of AXP’s ecosystem. With the card-issuing business remaining an important source of revenues for American Express, initiatives to add card issuers to its network indicate an increased issuance of cards, thereby augmenting AXP’s overall revenues.

Time and again, American Express resorts to enhancing its benefits or incorporating new options in the card offerings, thus catering to the evolving needs of a global consumer and commercial customer base.

The second endeavor of AXP can be noticed through its latest tie-up with WebBank, which promises to offer fintechs an opportunity to launch innovative payment solutions on the Amex network. The help extended to fintechs seems the need of the hour as it reflects the potential exhibited by the global fintech market in rolling out offerings that match the changing needs of Amex consumers.

In April 2022, American Express forged an alliance with the renowned digital payment and banking technology provider i2c to extend an innovative platform to fintechs for ramping up the launch of cards within the AXP network.

Shares of American Express have gained 3.1% in a year against the industry’s decline of 10.4%.

Zacks Investment Research
Zacks Investment Research


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Zacks Rank & Key Picks

American Express currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks from the Finance space are Amalgamated Financial Corp. AMAL, Capital City Bank Group, Inc. CCBG and Essex Property Trust, Inc. ESS. While Capital City Bank sports a Zacks Rank #1 (Strong Buy), Amalgamated Financial and Essex Property Trust carry a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The bottom line of Amalgamated Financial surpassed estimates in each of the trailing four quarters, the average surprise being 22.60%. The Zacks Consensus Estimate for AMAL’s 2022 earnings suggests an improvement of 42.4%, while the same for revenues suggests growth of 24.1% from the corresponding year-ago reported figures. The consensus mark for AMAL’s 2022 earnings has moved 3.4% north in the past 30 days.

The bottom line of Capital City Bank outpaced estimates in two of the last four quarters and missed the mark twice, the average surprise being 6.14%. The Zacks Consensus Estimate for CCBG’s 2022 earnings suggests an improvement of 22.2%, while the same for revenues suggests growth of 6.1% from the corresponding year-ago reported figures. The consensus mark for CCBG’s 2022 earnings has moved 0.8% north in the past 30 days.

The bottom line of Essex Property Trust outpaced estimates in each of the last four quarters, the average surprise being 1.46%. The Zacks Consensus Estimate for ESS’s 2022 earnings suggests an improvement of 15.3%, while the same for revenues suggests growth of 10.9% from the corresponding year-ago reported figures. The consensus mark for ESS’s 2022 earnings has moved 1.6% north in the past 30 days.

Shares of Amalgamated Financial and Capital City Bank have rallied 40.6% and 24.3%, respectively, in a year. The Essex Property Trust stock has, however, declined 16.7% in the same time frame.


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American Express Company (AXP) : Free Stock Analysis Report
 
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