American Express Co. (NYSE:AXP) has amended its bylaws to provide additional clarity on shareholder voting processes, as disclosed in a recent SEC filing. The changes, effective as of Wednesday, were approved by the company's Board of Directors to specify the impact of abstentions and broker non-votes on the required vote for corporate actions.
The modification to the bylaws, specifically to Section 2.4, aims to enhance the transparency of the voting outcomes on shareholder resolutions and other corporate decisions. Abstentions and broker non-votes, which occur when brokers do not receive instructions from the beneficial owners of the shares, can influence the outcome of votes at shareholder meetings.
Broker non-votes are typically not counted towards the vote total for most matters, except for routine issues where brokers can vote on behalf of shareholders without specific instructions. Abstentions are counted as present for the purposes of determining a quorum but are not counted as votes cast either for or against a proposal, thus potentially affecting the approval of matters requiring a majority of votes.
This update comes as part of American Express's ongoing efforts to ensure its corporate governance practices are clear and in line with regulatory requirements and best practices. It reflects the company's commitment to maintaining a transparent and fair process for shareholder participation in corporate decisions.
In other recent news, American Express has reported a significant 44% year-over-year earnings growth in the second quarter, marking a record high in revenue. The company adjusted its full-year earnings per share (EPS) guidance to $13.30 - $13.80.
Additionally, American Express issued $3.4 billion in new debt securities, expected to be used for general corporate purposes. However, the Central Bank of Russia revoked the banking license of the Russian subsidiary of American Express, marking the end of the company's direct banking presence in Russia.
American Express's U.S. consumer card loan portfolio saw a year-over-year increase of 12.4% to $87.3 billion, exceeding the third-quarter consensus forecast of 10.7%. The company's small business loan portfolio also experienced notable growth, increasing by 22.9% year-over-year to $30.1 billion, well above the anticipated 15.1%. Analyst perspectives have been mixed, with BMO Capital maintaining an underperform rating on American Express shares, despite adjusting its near-term earnings forecasts upwards due to lower-than-expected expenses.
RBC Capital Markets retained an Outperform rating and increased the share price target to $267, acknowledging the company's steady revenue and well-managed expenses.
InvestingPro Insights
American Express's recent bylaw amendment aligns with its strong market position and financial performance. According to InvestingPro data, the company boasts a substantial market capitalization of $192.87 billion, reflecting its prominence in the Consumer Finance industry. This is further supported by an InvestingPro Tip highlighting AXP as a "Prominent player in the Consumer Finance industry."
The company's commitment to shareholder value is evident not only in its governance practices but also in its dividend policy. An InvestingPro Tip notes that American Express "Has maintained dividend payments for 54 consecutive years," demonstrating long-term financial stability and shareholder commitment. Additionally, the company "Has raised its dividend for 3 consecutive years," with a current dividend yield of 1.04%.
American Express's strong financial position is reflected in its impressive revenue of $58.11 billion over the last twelve months as of Q2 2024, with a healthy revenue growth of 9.62% during the same period. This solid performance has contributed to a remarkable 81.3% price total return over the past year, positioning the stock near its 52-week high with a 99.79% proximity to that benchmark.
For investors seeking more comprehensive analysis, InvestingPro offers 12 additional tips for American Express, providing deeper insights into the company's financial health and market position.
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