Is The Western Union Company (WU) A Risky Investment?


The Western Union Company (NYSE:WU) finished Thursday with an addition of $0.23 to close at $13.88, an upside of 1.68 percent. An average of 3,775,500 shares of common stock have been traded in the last five days. There was a gain of $0.16 in the past week, and it reached a new high 11 times over the past 12 months. The last 20 days have seen an average of 5,108,545 shares traded, while the 50-day average volume stands at 5,293,964.

WU stock has decreased by -4.08% in the last month. The company shares reached their 1-month lowest point of $13.22 on 12/16/22. With the stock rallying to its 52-week high on 02/16/22, shares of the company touched a low of $12.27 and a high of $20.40 in 52 weeks. It has reached a new high 9 times so far this year and lost -22.20% or -$3.96 in price. In spite of this, the price is down -31.96% from the 52-week high.

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Insider Transactions

WU stock investors should be aware that The Western Union Company (WU) stock had its last reported insider trading activity 239 days ago on Nov 07. In this transaction, the insider spent $10,214. Interim Chief Legal Officer, Cebollero David, disposed of 2,221 shares at a price of $19.45 on Feb 23. The insider now owns more than $43,198 worth of shares. Prior to that, President, Global Network Farah Jean Claude went on to Sale 33,401 shares at $19.65 each on Feb 22. An amount of $656,179 was transacted.

Valuation Metrics

The Western Union Company (WU) has a trailing price-to-earnings (P/E) ratio of 6.57. The stock’s beta is 0.91. Other valuation ratios to consider include the trailing price-to-sales (P/S) ratio at 1.13, the price-to-book (PB) ratio at 10.13, and the price-to-cash flow ratio at 10.97.

The company has a payout ratio of 44.30%. The company’s most recent quarterly dividend payment was $0.2350 a share, without any change from last year. Its latest increase dividend $0.01 reported on Wednesday February 10 2021.

Financial Health

Further, the company has a long term debt to equity ratio of 4.61 and a total debt to equity ratio of 4.94 for the quarter ending September 29. Its gross profit as reported stood at $2.17 billion compared to revenue of $5.07 billion.

Earnings Surprise

In the quarter under review, the net income was down than the previous quarter. The company posted a net income of $173.9 million in the quarter, while revenues were shrunk -33.81%. The analyst consensus anticipated The Western Union Company’s latest quarter earnings to come in at $0.42 per share, but it turned out to be $0.42, a 0.00% surprise. For the quarter, EBITDA amounted to $276.6 million. Shareholders own equity worth $386.17 million.

Technical Picture

From a technical analysis perspective, let’s take a brief look at The Western Union Company (WU) price momentum. RSI 9-day as of the close on 29 December was 52.77%, suggesting the stock is Neutral, with historical volatility in this time frame at 26.61%.

As of today, WU’s price is $13.76 +1.17% or $0.16 from its 5-day moving average. WU is currently trading -5.32% lower than its 20-day SMA and -14.27% lower than its 100-day SMA. However, the stock’s current price level is -3.00% below the SMA50 and -20.82% below the SMA200.

The stochastic %K and %D were 42.54% and 43.20%, respectively, and the average true range (ATR) was 0.33. With the 14-day stochastic at 49.25% and the average true range at 0.36, the RSI (14) stands at 50.99%. The stock has reached 0.14 on the 9-day MACD Oscillator while the 14-day reading was at 0.01.

Analyst Ratings

UBS downgraded The Western Union Company (NYSE: WU) to a a Sell rating in its most recent analyst report. Previously, the stock was rated as a Neutral. The consensus rating for The Western Union Company (WU) among analysts is Underweight. According to current brokerage recommendations, 8 brokerage firms advise that investors sell WU, while 11 suggest investors hold. There are 1 analyst who rate the stock as underweight. The stock is rated overweight by 0 analysts, while 1 others rate it as a “buy”.

What is WU’s price target for the next 12 months?

Analysts predict a range of price targets between $10.00 and $18.00, with a median target of $14.00. Taking a look at these predictions, the average price target given by analysts for The Western Union Company (WU) stock is $13.82.


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