Western Union Co. LONG
Long @ $20.02
Market Cap - 9.31B
Beta - 1.02
P/CF - 5.90
Earnings Yield - 9.26%
Current Ratio - 0.84
- Western Union is expecting to benefit from the tax rate, they revised their outlook for tax rate and earnings per share. Earnings per share are forecasted in the range of $1.80 and $1.90 (previously was $1.78-$1.90). They also expect revenues to grow from 1-5% on a constant currency and GAAP basis, operating margin of 20% and an effective tax rate of around 14% and adjusted tax rate of 15%.
- WU has a large focus on enhancing shareholders' value - they try to achieve this by dividend payments and share buybacks. In February their quarterly dividend was increased by 9% and there dividend yield remains 3.1% above the industry average at 0.7%.
- WU has a massive return on equity at 698% which sits much higher than the industry's 38.5%, showing that WU has a great system using shareholders funds. Their return on equity has grown steadily over the past few years and we expect for it to continue.
- Worldwide immigration has been undergoing healthy growth and as Western Union's key business is C2C it will remain to grow if immigration continues to grow globally.
- We also expect technology investment to pay off and to improve margins.
- Western Union is currently range bound in a symmetrical triangle which it has been in for quite some time, this is why the shares have only gained 5.84% against the industry's 12.4%. The equity being so behind the industry in forward P/E and share price growth YTD provides an attractive opportunity.
NeroTree Capital rates Western Union as a BUY with a price target of $24.
Market Cap - 9.31B
Beta - 1.02
P/CF - 5.90
Earnings Yield - 9.26%
Current Ratio - 0.84
- Western Union is expecting to benefit from the tax rate, they revised their outlook for tax rate and earnings per share. Earnings per share are forecasted in the range of $1.80 and $1.90 (previously was $1.78-$1.90). They also expect revenues to grow from 1-5% on a constant currency and GAAP basis, operating margin of 20% and an effective tax rate of around 14% and adjusted tax rate of 15%.
- WU has a large focus on enhancing shareholders' value - they try to achieve this by dividend payments and share buybacks. In February their quarterly dividend was increased by 9% and there dividend yield remains 3.1% above the industry average at 0.7%.
- WU has a massive return on equity at 698% which sits much higher than the industry's 38.5%, showing that WU has a great system using shareholders funds. Their return on equity has grown steadily over the past few years and we expect for it to continue.
- Worldwide immigration has been undergoing healthy growth and as Western Union's key business is C2C it will remain to grow if immigration continues to grow globally.
- We also expect technology investment to pay off and to improve margins.
- Western Union is currently range bound in a symmetrical triangle which it has been in for quite some time, this is why the shares have only gained 5.84% against the industry's 12.4%. The equity being so behind the industry in forward P/E and share price growth YTD provides an attractive opportunity.
NeroTree Capital rates Western Union as a BUY with a price target of $24.
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