American Express Expands Digital Dining Tools with New Acquisitions Via Investing.com

NEW YORK – American Express (NYSE: NYSE:) has entered into agreements to acquire Tock and Rooam, two technology companies specializing in restaurant and event management and mobile payment solutions, respectively. The financial giant intends to improve its suite of digital offers for restaurants and merchants, as well as improve the quality of meals for its Card Members.

Tock’s takeover from Square space (NYSE: NYSE:) intends to enhance American Express’ existing dining platform by adding approximately 7,000 restaurants, wineries and other properties to its network. Tock, known for its reservations, table management and event ticketing tools, was launched in 2014 and acquired by Squarespace in 2021. The deal includes a partnership between Squarespace and American Express to provide additional benefits to small businesses through Amex Offers program.

Founded in 2015, Rooam is recognized for its integration with major point-of-sale providers, which will add new capabilities to the dashboard of Resy, American Express’s restaurant platform. Rooam technology aims to streamline marketing, loyalty programs and payment processes for hospitality service providers.

The transactions are subject to customary closing conditions, including regulatory approvals, particularly in the event of the Tock acquisition. American Express will buy Tock for $400 million in cash, subject to customary adjustments, while financial terms of the Rooam acquisition were not disclosed.

Howard Grosfield, president of US Consumer Services at American Express, commented on the acquisitions, emphasizing the company’s commitment to providing Cardmembers with exceptional dining benefits and experiences. Pablo Rivero, vice president of American Express Global Dining and CEO of Resy, noted that the acquisitions will enhance the company’s dining platform and support the industry’s growth.

Matthew Tucker, CEO of Tock, expressed his enthusiasm for the opportunity to innovate with American Express’ world-class restaurant program. Junaid Shams, co-founder and CEO of Rooam, highlighted the potential of their technology to support payments and loyalty programs for hospitality service providers.

These strategic acquisitions follow American Express’s growth in engaged guests and restaurant partners since acquiring Resy in July 2019. The company aims to continue to support the growth of the hospitality industry through these new partnerships.

In other recent news, American Express reported an increase in delinquency rates on U.S. consumer loans and Small Business Cards in May. Total lending to the consumer segment was $84.0 billion, while for small businesses it reached $28.2 billion. The company also announced changes in net write-off rates in both segments.

Financial companies are closely monitoring these developments. Barclays (LON:) maintained its Equalweight rating on American Express, forecasting potential 10% revenue growth by 2024, driven by net interest income. Wells Fargo (NYSE:) also maintained its Overweight rating, viewing the current stock valuation as an investment opportunity. Meanwhile, Citi assigned a Neutral rating with a price target of $250.00 per share based on forecasts of lower revenues offset by reduced expenses.

BTIG also initiated coverage on American Express with a neutral rating, citing potential challenges in consumer spending levels. Despite these concerns, American Express was recognized for its successful new customer growth in both the consumer and commercial sectors. Due to a significant geopolitical event, Russian President Vladimir Putin has authorized American Express to voluntarily terminate its operations in Russia. Finally, Keefe, Bruyette & Woods maintained its “Outperform” rating on American Express, indicating potential upside for the company’s stock. These are recent developments that investors may want to pay attention to.

InvestingPro Insights

As American Express (NYSE: AXP) continues to expand its digital offerings through strategic acquisitions, the company’s financial metrics provide insight into its market position and future prospects. With a solid market capitalization of $165.59 billion and a price-to-earnings (P/E) ratio of 18.96, American Express is trading at a low P/E ratio compared to near-term earnings growth. This is evidenced by the adjusted P/E ratio for the trailing twelve months, starting from Q1 2024, of 18.3, which is consistent with the company’s growth trajectory.

The company’s commitment to returning profits to shareholders is evidenced by its impressive track record of paying dividends for 54 consecutive years. This commitment to a consistent dividend, combined with a 1.22% dividend yield, demonstrates the stability and reliability of American Express as an investment. Additionally, the company’s revenue growth of 9.33% over the trailing twelve months from Q1 2024 further supports its strong financial performance.

InvestingPro Tips also highlights that American Express is a significant player in the consumer finance industry, and analysts predict the company will be profitable this year. These observations, along with the company’s strong price gain of 25.37% over the last six months, reflect investor confidence and positive market response to its strategic initiatives.

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This article was generated with the assistance of AI and reviewed by an editor. More information can be found in our Regulations.