AmEx Wins Stress Test Dividend & Bank Approvals (AXP)

American Express Co. (NYSE: AXP) has been approved for a capital return plan for its common shareholders after the stress tests. The current plan is to repurchase up to $4 billion during 2012 and it plans to purchase up to $1 billion in common stock in the first quarter of 2013.  The credit card giant expects to increase its quarterly dividend to $0.20 per quarter per share from a prior $0.18 per share per quarter.  That requires board approval, but consider it done.

Shares closed up 2.8% at $54.25 against a 52-week trading range of $41.30 to $54.45.  The current dividend yield is only 1.4%, so now that may go to 1.6% in a dividend yield.  Unfortunately, that is not a wild dividend hike.  As far as how the billions in buybacks translate, its market capitalization rate is $65.2 billion.