American Express Company (AXP), Mastercard Inc (MA), Visa Inc (V): Credit Card Companies Could Cash in on Jobs Creations

Page 1 of 2

With the United States economy appearing to be on rebound and jobs spreading like wildfire, there is a sense of optimism about the economy that might be the strongest we’ve seen since the recession. The U.S. added 175,000 new jobs last month, after hiring an additional 150,000 in April, the Labor Department stated.

So with so many people securing jobs, what does that mean for credit card companies? After all, a survey by Manpower Group, an international employment services titan, says more employers throughout the U.S. are planning on hiring workers in the next quarter than in any period since 2008′s fourth quarter.

What it all means

American Express Company (NYSE:AXP)

If a continued increase in hiring proves true, there will be a considerable number of people with money again. For American Express Company (NYSE:AXP), MasterCard Inc (NYSE:MA) and VISA Inc (NYSE:V) that means two things: more people will be able to pay off their credit card bills, and more people will be making additional purchases. In other words, credit card companies could cash in on late payments that have been piling up since the recession, and those same people will likely buy on credit again.

American Express’s story

American Express Company (NYSE:AXP) has increased by about 35% year to date, and that is a substantial hike from moderate gains in the previous post-recession years. Consumers are gradually becoming more optimistic and even reached a six-year high in confidence recently. The economic recovery will mean increased use of credit cards, as people feel more comfortable making purchases. There will be a likely decrease in accounts receivable and an increase in revenue. Some doubt does linger, however, as American Express relies on public credit card debt for much of its earnings. The future may appear relatively uncertain, but the general economic recovery will fuel this stock’s performance despite decreasing consumer debt.

MasterCard’s story

Mastercard Inc (NYSE:MA) has a premium value, which could indicate the stock is ready for substantial growth. The company’s past performance speaks for itself — as the firm has had a return on investment of five times more than Visa Inc (NYSE:V) since the recession — but determining whether the future will repeat itself takes a bit of digging. The company is increasing its presence in China, Africa and the Middle East, which will likely provide a major source of revenue from not only those who live in these countries, but also from those who travel for business or pleasure. MasterCard is reportedly in negotiations with Kenyan banks, which would service a huge number of potential customers. As the standard of living in Africa improves, the 80% who don’t use a bank will gradually decrease, and MasterCard is in a position to cash in.

VISA’s story

VISA will see some of the same benefits, but the company is in a stronger financial position than American Express Company (NYSE:AXP) and Mastercard Inc (NYSE:MA). The firm is nearly twice as big as both companies, and this could help to execute its vision of global payment options. The company is creating payment networks that will facilitate the ease for tourists and business people to use their cards seamlessly throughout the world. That’s a move in which American Express hasn’t been as active. Unlike Visa Inc (NYSE:V), American Express’s growth is mainly driven by adding new products and services.

Page 1 of 2

Biotech Insider Alert - $6 Stock To Hit $40

$200 Million Dollar Healthcare Hedge Fund's #1 Best Idea Right Now

The best healthcare hedge fund out there right now is one of the largest shareholders in this biotech stock. The fund returned more than 20% in each of the last 2 years with a virtually fully hedged portfolio, and it's sending out a BUY signal on this biotech stock. Get your FREE REPORT today (retail value of $300)

This is a FREE report from Insider Monkey. Credit Card is NOT required.
Click here to Read Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 74 percentage points in 2.5 years. Our beta is only 1.2 (download a FREE newsletter and see the details inside)

Lists

Best Selling Magazines in the World

Shortest People in History

The Most Celebrated Holidays in the World

Most Expensive Handbag Brands in the World

Top Selling Comic Book Issues of this Century

The Most Powerful Women in Politics

Best Paid DJs

Most Rebellious Female Artists

Best Paid TV Actresses of 2014

Best Paid Actors of 2014

Most Expensive Horses in the World

Tallest People Ever

Most Encouraging Feminist Celebrities

Best Paid Supermodels of 2014

Top 10 Suburbs for Retirement in 2015

10 Wealthiest Cities in America

Top 10 TED Talks for Entrepreneurs

Best TED Talks on Education

25 Most Dangerous Places to Live in America

Top 10 Ski Resorts in the United States – 2014 List

Top 10 Most Remote Places in the World

Most Visited Museums in the United States

Wealthiest Photographers in the World

Most Famous Gay Athletes

The World’s Most Famous Circuses

Best Hair Stylists

Most Popular NASCAR Drivers

The Best Romance Movies of all Time

The Most Wanted Drug Lords

The Oldest Money Managers

The Greatest Directors in the World

Largest Animals in the World

World’s Most Expensive Desserts

Best Selling Comic Books of All Time

A-list Actors who Sabotaged Their Career

Rappers With a College Degree

The Best Jazz Albums of all Time

The Most Influential Jazz Musicians

The World’s Most Famous Photographers

The Best Oscar-Winning Songs

Most Influential Choreographers Ever

Most Expensive Department Stores in the World

The Most Expensive Stolen Paintings in the World

The World’s Most Expensive Teas

Top Oscar Record Holders

The Most Expensive Flowers in the World

Countries With a Booming Film Industry

Most Expensive Cupcakes in the World

Uncommon European Escapes

The Most Stolen Artists in History

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 129% in 2.5 years!! Wondering How?

Download a complete edition of our newsletter for free!