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Why Hold is Your Best Bet for Western Union (WU) Stock Now
Western UnionWestern Union(US:WU) ZACKSยท2024-07-11 16:45

Core Insights - Western Union is positioned for growth due to increasing transaction volumes and strong performance in its Consumer Money Transfer segment across various regions [1][2] - The company has a market cap of $4.2 billion and its shares have gained 3.9% year-to-date, outperforming the industry [1] - The forward 12-month price-to-earnings ratio of 6.85X is significantly lower than the industry average of 20.83X, indicating affordability [1] Financial Performance - The Zacks Consensus Estimate for Western Union's current-year earnings is $1.76 per share, reflecting a 1.2% increase from the previous year [1] - The consensus estimate for current-year revenues is nearly $4.2 billion, with expectations of a 10% year-over-year revenue increase in the Consumer Services business for 2024 [2] - In the first quarter, the company distributed $80 million in dividends and $150 million in share buybacks, showcasing its commitment to returning value to shareholders [2] Strategic Initiatives - Collaborations with fintechs and financial institutions are enhancing service offerings, with innovations like Send Now, Pay Later expected to improve market penetration [2] - The extensive global network of Western Union, covering over 200 countries and territories, strengthens its market position and accessibility [2] Shareholder Value - As of March 31, 2024, Western Union had $198.2 million remaining in share repurchase authorization for the year [3] - Last year, the company returned $646 million to shareholders through buybacks and dividends, indicating a strong commitment to shareholder value [3] Dividend Yield - Western Union's current dividend yield is 7.6%, significantly higher than the industry average of 0.8%, likely attracting investor interest [2]