Western Union (WU) Sees a More Significant Dip Than Broader Market: Some Facts to Know

Western Union (WU) closed the most recent trading day at $7.16, moving -1.1% from the previous trading session. This change lagged the S&P 500's daily loss of 0.33%. Elsewhere, the Dow lost 0.7%, while the tech-heavy Nasdaq lost 0.12%.

Shares of the money transfer company have appreciated by 13.84% over the course of the past month, outperforming the Business Services sector's gain of 0.98%, and the S&P 500's gain of 3.87%.

Investors will be eagerly watching for the performance of Western Union in its upcoming earnings disclosure. The company's upcoming EPS is projected at $0.35, signifying a 25.53% drop compared to the same quarter of the previous year. Alongside, our most recent consensus estimate is anticipating revenue of $1.05 billion, indicating a 1.6% upward movement from the same quarter last year.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $1.29 per share and a revenue of $4.13 billion, representing changes of -26.29% and +2.04%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for Western Union. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 25.97% lower. Western Union currently has a Zacks Rank of #5 (Strong Sell).

In terms of valuation, Western Union is currently trading at a Forward P/E ratio of 5.61. This valuation marks a discount compared to its industry average Forward P/E of 13.52.

The Financial Transaction Services industry is part of the Business Services sector. At present, this industry carries a Zacks Industry Rank of 150, placing it within the bottom 40% of over 250 industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.

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This article originally published on Zacks Investment Research (zacks.com).

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