The Western Union Company (NYSE: WU) received a consensus recommendation of “Reduce” from analysts, reflecting ongoing concerns about the company’s performance in the financial markets. According to a report from Marketbeat Ratings, of the fourteen research firms covering Western Union, four analysts have issued a sell rating and ten have provided a hold rating. The average target price for the company’s shares stands at $8.80 over the next twelve months.
Analysts have been vocal about their predictions for Western Union. UBS Group adjusted its target price from $8.50 to $9.00, maintaining a “neutral” rating in a report published on November 10, 2023. Similarly, Keefe, Bruyette & Woods raised its price objective from $9.00 to $10.00, assigning a “market perform” rating on January 2, 2024. Susquehanna also set its price target at $10.00, echoing a “neutral” rating. Meanwhile, Citigroup upgraded Western Union to a “hold” rating on October 23, 2023, and Zacks Research improved its rating from “strong sell” to “hold” on October 7, 2023.
Current Stock Performance and Financial Metrics
As of Monday, shares of Western Union opened at $9.26, reflecting a 2.6% decline. The company’s performance metrics show a 50-day simple moving average of $9.16 and a 200-day simple moving average of $8.68. Over the past year, the stock has fluctuated between a low of $7.85 and a high of $11.94.
The company reported a market capitalization of $2.94 billion, with a price-to-earnings (PE) ratio of 4.04 and a price/earnings to growth (PEG) ratio of 2.80. Western Union’s debt-to-equity ratio stands at 2.80, while both its quick and current ratios are 1.12.
In its latest quarterly earnings report on October 23, 2023, Western Union announced earnings per share (EPS) of $0.47, which surpassed analysts’ expectations of $0.43. The company generated revenue of $1.02 billion, slightly below the consensus estimate of $1.03 billion. Year-over-year, revenue decreased by 0.3%, while the prior year’s EPS for the same quarter was $0.46. Western Union has set guidance for fiscal year 2025 at $1.650-$1.750 EPS.
Dividend Announcements and Insider Activity
In related news, Western Union declared a quarterly dividend of $0.235 per share, which was paid on December 31, 2023. Shareholders of record on December 22, 2023, received this distribution, translating to an annualized dividend of $0.94 and a dividend yield of 10.2%. The ex-dividend date was also December 22, 2023, and the company’s dividend payout ratio currently stands at 41.05%.
In a notable insider transaction, Giovanni Angelini, a company insider, purchased 10,000 shares on November 10, 2023, at an average price of $8.95 per share, amounting to a total transaction of $89,500. Following this acquisition, Angelini’s total ownership rose to 186,932 shares, valued at approximately $1,673,041.40, reflecting a 5.65% increase in ownership.
Institutional Investor Movements
Recent activity among institutional investors has influenced Western Union’s stock. Wilmington Savings Fund Society FSB significantly increased its holdings by 606.7% in the third quarter, now owning 3,265 shares valued at $26,000 after acquiring an additional 2,803 shares. UMB Bank n.a. raised its position by 260.7%, possessing 3,593 shares worth $29,000 following a purchase of 2,597 shares.
GAMMA Investing LLC also expanded its stake by 164.9% in the fourth quarter, now holding 3,581 shares valued at $33,000. Danske Bank A S purchased a new stake worth approximately $37,000 during the third quarter, while Hantz Financial Services Inc. increased its holdings by 667.0% in the second quarter, now owning 4,602 shares valued at $39,000. Overall, institutional and hedge fund investors control approximately 91.81% of Western Union’s stock.
Western Union continues to play a significant role in the global payment ecosystem, facilitating cross-border transactions for individuals and businesses alike. Its diverse service offerings encompass person-to-person money transfers, business-to-business payments, and various digital platforms, which are essential as it navigates an increasingly competitive financial landscape.
