NYSE:WU

Stock Analysis Report

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Executive Summary

The Western Union Company provides money movement and payment services worldwide. More Details


Snowflake Analysis

Established dividend payer and good value.


Similar Companies

Share Price & News

How has Western Union's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: WU is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 5% a week.

Volatility Over Time: WU's weekly volatility (5%) has been stable over the past year.


Market Performance


7 Day Return

5.7%

WU

3.2%

US IT

1.3%

US Market


1 Year Return

-16.2%

WU

29.9%

US IT

21.0%

US Market

Return vs Industry: WU underperformed the US IT industry which returned 28.1% over the past year.

Return vs Market: WU underperformed the US Market which returned 20.9% over the past year.


Shareholder returns

WUIndustryMarket
7 Day5.7%3.2%1.3%
30 Day16.0%16.9%12.1%
90 Day-4.4%2.7%4.8%
1 Year-12.9%-16.2%31.3%29.9%23.7%21.0%
3 Year28.4%14.5%103.1%95.1%46.6%36.8%
5 Year42.3%18.6%177.1%157.8%94.6%73.2%

Long-Term Price Volatility Vs. Market

How volatile is Western Union's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Western Union undervalued compared to its fair value and its price relative to the market?

31.6%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: WU ($22.56) is trading below our estimate of fair value ($32.99)

Significantly Below Fair Value: WU is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: WU is good value based on its PE Ratio (13.3x) compared to the US IT industry average (35.9x).

PE vs Market: WU is good value based on its PE Ratio (13.3x) compared to the US market (19.7x).


Price to Earnings Growth Ratio

PEG Ratio: WU is poor value based on its PEG Ratio (1.4x)


Price to Book Ratio

PB vs Industry: WU is overvalued based on its PB Ratio (138.2x) compared to the US IT industry average (4x).


Next Steps

Future Growth

How is Western Union forecast to perform in the next 1 to 3 years based on estimates from 19 analysts?

9.5%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: WU's forecast earnings growth (9.5% per year) is above the savings rate (2.2%).

Earnings vs Market: WU's earnings (9.5% per year) are forecast to grow slower than the US market (22% per year).

High Growth Earnings: WU's earnings are forecast to grow, but not significantly.

Revenue vs Market: WU's revenue (3.3% per year) is forecast to grow slower than the US market (10.3% per year).

High Growth Revenue: WU's revenue (3.3% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: WU's Return on Equity is forecast to be very high in 3 years time (201.4%).


Next Steps

Past Performance

How has Western Union performed over the past 5 years?

7.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: WU has high quality earnings.

Growing Profit Margin: WU's current net profit margins (14.4%) are lower than last year (21.1%).


Past Earnings Growth Analysis

Earnings Trend: WU's earnings have grown by 7.3% per year over the past 5 years.

Accelerating Growth: WU's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: WU had negative earnings growth (-38.1%) over the past year, making it difficult to compare to the IT industry average (3.2%).


Return on Equity

High ROE: Whilst WU's Return on Equity (1047.09%) is outstanding, this metric is skewed due to their high level of debt.


Next Steps

Financial Health

How is Western Union's financial position?


Financial Position Analysis

Short Term Liabilities: WU's short term assets ($1.7B) do not cover its short term liabilities ($5.3B).

Long Term Liabilities: WU's short term assets ($1.7B) do not cover its long term liabilities ($3.5B).


Debt to Equity History and Analysis

Debt Level: WU's debt to equity ratio (4525.3%) is considered high.

Reducing Debt: WU's debt to equity ratio has increased from 257.9% to 4525.3% over the past 5 years.

Debt Coverage: WU's debt is well covered by operating cash flow (27.5%).

Interest Coverage: WU's interest payments on its debt are well covered by EBIT (8.1x coverage).


Balance Sheet


Next Steps

Dividend

What is Western Union current dividend yield, its reliability and sustainability?

3.99%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: WU's dividend (3.99%) is higher than the bottom 25% of dividend payers in the US market (1.47%).

High Dividend: WU's dividend (3.99%) is low compared to the top 25% of dividend payers in the US market (4.08%).


Stability and Growth of Payments

Stable Dividend: WU's dividends per share have been stable in the past 10 years.

Growing Dividend: WU's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (51.6%), WU's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: WU's dividends in 3 years are forecast to be well covered by earnings (41.9% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.4yrs

Average management tenure


CEO

Hikmet Ersek (59 yo)

10.17yrs

Tenure

US$10,099,500

Compensation

Mr. Hikmet Ersek has been the Chief Executive Officer and President at The Western Union Company since September 1, 2010. Mr. Ersek served as the Chief Operating Officer of The Western Union Company from J...


CEO Compensation Analysis

Compensation vs Market: Hikmet's total compensation ($USD10.10M) is above average for companies of similar size in the US market ($USD6.89M).

Compensation vs Earnings: Hikmet's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Hikmet Ersek
President10.17yrsUS$10.10m0.23%
$ 21.8m
Rajesh Agrawal
Chief Financial Officer6.33yrsUS$3.80m0.067%
$ 6.2m
Caroline Tsai
Chief Legal Officer & Corporate Secretary2.92yrsUS$2.03m0.0018%
$ 165.1k
Jean Farah
President of Global Network11.67yrsUS$2.22m0.051%
$ 4.7m
Khalid Fellahi
President of Consumer Money Transfer1.33yrsUS$2.24m0.022%
$ 2.1m
Mark Hinsey
Chief Accounting Officer & Controller0.67yrno data0.0040%
$ 371.0k
Brad Windbigler
Senior VPno datano datano data
Tyler Hand
Chief Compliance Officer1.83yrsno datano data
Nicole Vogrin
Chief Corporate Affairs & Communications Officer1.83yrsno datano data
Richard Williams
Chief People Officer7.83yrsno data0.025%
$ 2.4m
Carter Hunt
Senior VP & GM of USno datano datano data
Jacqueline Molnar
Chief Transformation Officer1.83yrsno data0.0070%
$ 653.9k

2.4yrs

Average Tenure

54yo

Average Age

Experienced Management: WU's management team is considered experienced (2.4 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Hikmet Ersek
President10.17yrsUS$10.10m0.23%
$ 21.8m
Jeffrey Joerres
Independent Non-Executive Chairman of the Board3.5yrsUS$485.00k0.0011%
$ 103.0k
Richard Goodman
Independent Director8.83yrsUS$290.00k0.000030%
$ 2.8k
Solomon Trujillo
Independent Director8.33yrsUS$245.00k0.0029%
$ 266.2k
Betsy Holden
Independent Director14.17yrsUS$285.00k0.0012%
$ 113.2k
Michael Miles
Independent Director14.17yrsUS$250.00kno data
Martin Cole
Independent Director5.33yrsUS$270.00k0.0070%
$ 646.5k
Jan Siegmund
Independent Director0.92yrUS$18.80k0.0024%
$ 225.4k
Timothy Murphy
Independent Director0.67yrno data0.00079%
$ 73.3k
Joyce Phillips
Director0.33yrno data0.00090%
$ 83.5k
Angela Sun
Independent Director2.33yrsUS$260.00k0%
$ 0

5.3yrs

Average Tenure

59yo

Average Age

Experienced Board: WU's board of directors are considered experienced (5.3 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

The Western Union Company's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: The Western Union Company
  • Ticker: WU
  • Exchange: NYSE
  • Founded: 2006
  • Industry: Data Processing and Outsourced Services
  • Sector: Software
  • Market Cap: US$9.275b
  • Shares outstanding: 411.12m
  • Website: https://www.westernunion.com

Number of Employees


Location

  • The Western Union Company
  • 7001 East Belleview Avenue
  • Denver
  • Colorado
  • 80237
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
WUNYSE (New York Stock Exchange)YesCommon StockUSUSDSep 2006
W3UDB (Deutsche Boerse AG)YesCommon StockDEEURSep 2006
WU *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNSep 2006
0LVJLSE (London Stock Exchange)YesCommon StockGBUSDSep 2006
WUNI34BOVESPA (Bolsa de Valores de Sao Paulo)BDR REPR 1 COM SHARE USD0.01BRBRLJul 2015

Biography

The Western Union Company provides money movement and payment services worldwide. The company operates in two segments, Consumer-to-Consumer and Business Solutions. The Consumer-to-Consumer segment facilit...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/12/01 00:06
End of Day Share Price2020/11/30 00:00
Earnings2020/09/30
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.