This Catalyst Could Make American Express Company (AXP) Earnings Soar

As a result, AmEx has benefited from the rise in the stock market and the overall economy. With its business still primarily centered on the U.S., AmEx has also reaped the rewards of being in the right place at the right time, as the U.S. has seen its stock market fare much better than the rest of the world, and with most of AmEx’s traditional clientele enjoying the wealth effect, that should translate to higher network volume.

The wildcard catalyst for AmEx, though, is its Bluebird prepaid debit card. With broad appeal to a base of customers that AmEx has heretofore largely ignored, Bluebird could be a huge growth-driver or an immense flop, depending on whether its adoption goes according to plan. Rising numbers of part-time jobs in recent employment figures suggest that the low-end card market could gain strength, leading to growth for this segment for AmEx.

When American Express Company (NYSE:AXP) announces earnings, watch closely for news about how Bluebird is doing and whether it’s as profitable as the company had hoped. While good conditions elsewhere should help AmEx grow, strength from Bluebird is what could really send growth much higher.

Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter @DanCaplinger. The Motley Fool recommends American Express Company (NYSE:AXP), Mastercard Inc (NYSE:MA), and Visa Inc (NYSE:V). The Motley Fool owns shares of Mastercard Inc (NYSE:MA).

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