In late October of 2014, American Express (AXP) traded at $86.40 per share and had a total market capitalization of approx. $90.42B. This is compared to its competitors including Visa (V) and MasterCard (MA) at approximately $133B and $85.69B respectively. While all three companies are in the same industry and arguably overlap in target customers, American Express has been known to target higher net worth individuals. Resulting in generating more revenues per customer than either.
American Express typically offers more attractive rewards and benefits to its card members than V and MA. The reason they are able to do this is because their typical card member spends more than that of a Visa or MasterCard user.
Unlike that of Visa and Mastercard, American Express is that it is also in the banking industry. AXP has subsidiaries that are bank holding companies including Centurion Bank and AEBFSB. In addition to revenue from card services, AXP earns interest income on deposits at its banks. While both of which are subject to Dodd-Frank and FDIC regulations, both banks are well-capitalized.
Disclaimer: This article is written for informational purposes only and isn't intended as investment advice.
Disclosure: I do not have a position in AXP.