Western Union (WU) closed at $9.70 in the latest trading session, marking a +1.25% move from the prior day. The stock exceeded the S&P 500, which registered a loss of 0.57% for the day. Elsewhere, the Dow lost 1.61%, while the tech-heavy Nasdaq lost 0.26%.
The stock of money transfer company has fallen by 3.04% in the past month, lagging the Business Services sector's gain of 0.32% and the S&P 500's loss of 0.15%.
The upcoming earnings release of Western Union will be of great interest to investors. The company's upcoming EPS is projected at $0.41, signifying steadiness compared to the same quarter of the previous year. At the same time, our most recent consensus estimate is projecting a revenue of $969.86 million, reflecting a 1.4% fall from the equivalent quarter last year.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $1.79 per share and a revenue of $4.17 billion, indicating changes of +2.29% and +2.86%, respectively, from the former year.
It is also important to note the recent changes to analyst estimates for Western Union. Such recent modifications usually signify the changing landscape of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Within the past 30 days, our consensus EPS projection has moved 0.71% lower. As of now, Western Union holds a Zacks Rank of #3 (Hold).
Valuation is also important, so investors should note that Western Union has a Forward P/E ratio of 5.37 right now. For comparison, its industry has an average Forward P/E of 9.4, which means Western Union is trading at a discount to the group.
One should further note that WU currently holds a PEG ratio of 1.87. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. WU's industry had an average PEG ratio of 0.95 as of yesterday's close.
The Financial Transaction Services industry is part of the Business Services sector. At present, this industry carries a Zacks Industry Rank of 167, placing it within the bottom 32% of over 250 industries.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.
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The Western Union Company (WU): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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