In the latest close session, Western Union (WU) was up +1.88% at $8.67. The stock outperformed the S&P 500, which registered a daily loss of 0.64%. Elsewhere, the Dow saw a downswing of 0.2%, while the tech-heavy Nasdaq depreciated by 1.15%.
Heading into today, shares of the money transfer company had gained 5.71% over the past month, outpacing the Business Services sector's gain of 1.84% and the S&P 500's gain of 1.91%.
Market participants will be closely following the financial results of Western Union in its upcoming release. It is anticipated that the company will report an EPS of $0.43, marking a 6.52% fall compared to the same quarter of the previous year. Our most recent consensus estimate is calling for quarterly revenue of $1.02 billion, down 1.39% from the year-ago period.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $1.7 per share and a revenue of $4.08 billion, indicating changes of -2.3% and -3.06%, respectively, from the former year.
It is also important to note the recent changes to analyst estimates for Western Union. These revisions help to show the ever-changing nature of near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, ranging from #1 (Strong Buy) to #5 (Strong Sell), possesses a remarkable history of outdoing, externally audited, with #1 stocks returning an average annual gain of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 0.01% increase. Western Union presently features a Zacks Rank of #5 (Strong Sell).
In terms of valuation, Western Union is currently trading at a Forward P/E ratio of 5.01. Its industry sports an average Forward P/E of 15.42, so one might conclude that Western Union is trading at a discount comparatively.
It's also important to note that WU currently trades at a PEG ratio of 2.92. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Financial Transaction Services industry had an average PEG ratio of 1.28 as trading concluded yesterday.
The Financial Transaction Services industry is part of the Business Services sector. At present, this industry carries a Zacks Industry Rank of 51, placing it within the top 21% of over 250 industries.
