NEW YORK (TheStreet) -- Costco Wholesale Corp. (COST) , the retailer that replaced American Express Co. (AXP) as its credit-card issuer in Canada, is considering a similar move with its larger U.S. portfolio, sources told Bloomberg.
Costco is seeking bids for both an issuer and a payments network for its U.S. cards, sources added. AmEx could be among the firms bidding on the contract, sources said.
In September, Costco struck a deal with Capital One Financial Corp. (COF) and MasterCard (MA) to issue co-branded credit cards in Canada when the retailer's contract with AmEx ends this year, Bloomberg noted. Costco notified customers that it will stop accepting all American Express cards in Canada on Jan. 1 after negotiations between the two companies to renew the contract fell through.
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American Express was the only credit card accepted at Costco stores in Canada. AmEx has a separate contract with Costco in the U.S. The retailer operates 468 stores in the U.S. and Puerto Rico, and 88 in Canada, according to its website.
Shares of Costco closed down at $136.50 yesterday, while American Express shares are up 0.30% to $92.70 in pre-market trade today.
TheStreet Ratings team rates COSTCO WHOLESALE CORP as a Buy with a ratings score of A+. TheStreet Ratings Team has this to say about their recommendation: