Western Union Intrinsic Stock Value – Western Union Reports Positive Earnings in Q3
October 27, 2023
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Western Union ($NYSE:WU) has reported positive earnings in its third quarter, indicating a strong period of financial growth. This was partially attributed to the company’s focus on digital services, which now account for 1/3 of total transfers. Western Union is a financial services provider based in Englewood, Colorado. It is a widely recognized leader in cross-border, cross-currency money movement. Its business segments include consumer money transfer, money orders, business solutions, and bill payments. It is a publicly traded company, listed on the New York Stock Exchange with the symbol WU. The company’s success this quarter can be attributed to its strategic investments in digital transformation.
This has enabled them to take advantage of the digital payments revolution and expand their services into new markets. The company also continues to focus on improving customer experience, with initiatives such as reducing fees for low-value transactions and launching a mobile app. These efforts have resulted in increased customer engagement and higher transaction volumes. Overall, Western Union’s strong performance in the third quarter has been a positive sign for the company’s long-term prospects. Its strategic investments have enabled it to capitalize on the growing demand for digital payments and position itself for continued growth. With its commitment to innovation and outstanding customer service, there is no doubt that Western Union will continue to be a leader in money movement for years to come.
Earnings
Western Union reported positive earnings for its third quarter of 2021, ending June 30. Total revenue for the quarter was $1289.7 million, an increase of 13.3% from the previous year. Net income was $222.5 million, a 14.7% increase from the previous year.
Over the last three years, total revenue for Western Union has grown from $1170.0 million to $1289.7 million. This is a testament to the stability and success of the company and the growth potential of its services.
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Western Union. More…
| Total Revenues | Net Income | Net Margin |
| 4.39k | 751.3 | 15.1% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Western Union. More…
| Operations | Investing | Financing |
| 538.8 | 168.1 | -998.8 |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Western Union. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 8.49k | 7.86k | 1.67 |
Key Ratios Snapshot
Some of the financial key ratios for Western Union are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| -3.7% | -1.9% | 20.8% |
| FCF Margin | ROE | ROA |
| 7.4% | 96.6% | 6.7% |
Share Price
Western Union reported strong earnings in the third quarter. On Wednesday, Western Union stock opened at $13.1 and closed at $12.9, down by 2.6% from the prior closing price of 13.3. The company reported steady growth in money transfer transactions, with volumes increasing 3% year over year. Live Quote…
Analysis – Western Union Intrinsic Stock Value
We at GoodWhale have conducted a thorough analysis of the fundamentals of Western Union. Our proprietary Valuation Line model has determined that the fair value of Western Union’s shares is around $16.6. Currently, Western Union’s stock is traded at $12.9, which is undervalued by a margin of 22.2%. Therefore, our analysis suggests that there is an opportunity to buy Western Union’s stock at a discount. More…
Peers
It has a wide network of agents and locations around the world. Western Union has several competitors, including American Express Co, Mastercard Inc, and PayPal Holdings Inc.
– American Express Co ($NYSE:AXP)
American Express is a financial services company that provides charge and credit cards, rewards programs, travel services, and more. The company has a market cap of 106.78B as of 2022. American Express was founded in 1850 and is headquartered in New York City, New York.
– Mastercard Inc ($NYSE:MA)
Mastercard Incorporated is an American multinational financial services corporation headquartered in Purchase, New York, United States. The company’s core products are credit, debit, prepaid, and commercial payment cards, issued to consumers and businesses worldwide. Mastercard also processed approximately $3.4 trillion in payments in 2019.
The company has a market cap of $286.32B as of 2022 and a Return on Equity of 110.3%. Mastercard is a publicly traded company with its shares listed on the New York Stock Exchange (NYSE).
– PayPal Holdings Inc ($NASDAQ:PYPL)
PayPal Holdings Inc is a US-based company that operates a worldwide online payments system that supports online money transfers and serves as an electronic alternative to traditional paper methods like checks and money orders. The company has a market cap of 98.05B as of 2022 and a Return on Equity of 11.16%. PayPal is one of the largest online payment processors in the world and handles over 9 million transactions every day.
Summary
This is primarily attributed to higher money transfer transaction fees and foreign exchange revenue, as well as higher volumes driven by pandemic-related trends. The company also announced an additional share buyback program of up to $2 billion. Overall, the company appears to be well positioned for future growth.
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