Is The Western Union Company Stock Attractive?

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[Updated 11/26/2021] western union company update

western union company stock (NYSE:WU) is currently trading near $17 per share, down about 40% from its pre-Covid-19 peak. The company is a market leader in cross-border money movement and payment services. It saw its stock trading at around $28 in February 2020 just before the outbreak of the pandemic and is still 40% below that level. The stock is down nearly 9% from its March lows of 2020 compared to the S&P 500, which has more than doubled (110%) during the period. Economic activity has benefited from the accelerated COVID-19 vaccination program and the lifting of lockdown restrictions in the year, but the recovery has been slow. whereas Western Union Company Revenue While growth grew 8% for the first six months of 2021, growth slowed in the third quarter — Q3 revenue grew just 2%. This was due to a slight decrease in consumer-to-consumer transaction volume. The company posted mixed results in its recently released third-quarter results, topping the earnings consensus and missing revenue expectations. In addition, the Street expects WU to report total revenue of approximately $1.29 billion in the fourth quarter, taking the full-year figure to $5.08 billion — about 4% less than the 2019 figure. This slow recovery has put investors on a positive alert for WU stock.

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A return to pre-Covid levels means that WU’s stock will have to increase by 67 per cent from here. We believe that full recovery is possible in the next 1.5-2 years, once transaction volume recovers to pre-Covid-19 levels. That said, transaction volume at offline retail locations is still suffering due to the slow pace of economic recovery. While growth in digital money transfer transactions (up 38% for the first nine months) supported the top-line, it has not been able to offset the decline in offline volumes. Notably, WU’s total trading volume increased by 7% for the first nine months – lower than pre-Covid-19 levels. In addition, many places have started implementing lockdown restrictions again due to the resurgence of COVID-19 cases. This could further impede growth, however, given the high rate of vaccination, the impact is unlikely to be as severe as last year. Overall, we expect the recovery in the economy to boost transaction volumes in the coming quarters. This will help the stock of WU to gain around 67% over the next 1.5-2 years, making it a good investment opportunity.

Our conclusion. based on a detailed comparison of Western Union Company Stock During the 2008 Recession Versus Now In our dashboard analysis.

[Updated 10/29/2021] What to Expect from Western Union Company Stock?

western union company stock (NYSE:WU) is currently trading close to $19 per share, down about 34% from its pre-Covid-19 peak. WU, a global leader in cross-border money movement and payment services, saw its stock trading above $28 in February 2020 just before the outbreak of the pandemic, and is still down about 34% from that level. The stock is at a similar level to its March 2020 lows compared to the S&P 500, which has more than doubled (up 105%) during the period. The easing of lockdown restrictions and the rapidly evolving COVID-19 vaccination program have helped in recovering economic activity to a great extent. This is evident from the improvement in WU’s trading volume in recent quarters. Specially, Western Union Company Revenue grew 8% yoy to $2.5 billion for the first half of 2021. That said, the revenue figure was still down 7% from semi-annual revenue in 2019. In addition, WU is expected to post total revenue of approximately $1.32 billion in the third quarter (by consensus estimates) — 6% annually. Revenue for the first nine months would reach $3.8 billion, still down 4% from the 2019 figure. This slow recovery in revenue is the main reason behind negative investor sentiment towards the stock.

A return to pre-Covid levels means that WU’s stock will have to increase by 53 per cent from here. We believe that a full recovery is possible in the near term, once trading volume recovers to pre-Covid-19 levels. The company is heavily dependent on the consumer-to-consumer division, which contributes around 90% of the total revenue. It runs most of its business from offline retail locations. The revenue stream suffered due to Covid-19 related restrictions and economic slowdown in 2020. On the other hand, the firm saw a significant increase in the number of digital transactions, as the focus of customers shifted to digital due to the COVID-19 crisis. While the trading volume has improved in 2021, it is still below pre-Covid-19 levels. We expect the recovery in the economy to boost transaction volumes in the coming quarters. Overall, this will likely help WU’s stock rise by about 53% in the near term, making it a good investment opportunity.

Our conclusion. based on a detailed comparison of Western Union Company Stock During the 2008 Recession Versus Now In our dashboard analysis.

[Updated 09/30/2021] Will Western Union Company’s stock recover to its pre-Covid level?

western union company stock (NYSE:WU) is currently trading at $21 per share, down about 27% from its pre-Covid-19 peak. A leader in global currency movement and payment services, WU saw its stock trading above $28 in February 2020 just before the outbreak of the pandemic and still down about 27% from that level. The stock is up 12% from its March lows of 2020 compared to the S&P 500 that nearly doubled during the period. The easing of lockdown restrictions and successful vaccine rollouts have boosted economic activity, leading to higher transaction volumes, especially in the consumer-to-consumer segment. This is also evident from the growth in India Western Union Company Revenue In recent quarters — semi-annual revenue grew 8% year over year to $2.5 billion. Despite this, the stock has underperformed the broader index. The negative investor sentiment is on account of slow recovery in revenue and transaction volumes from retail locations in the consumer-to-consumer segment, which is still below pre-Covid-19 levels.

A return to pre-Covid levels means that WU’s stock will have to increase by 36 per cent from here. We believe a near-term upside is possible once trading volume recovers to pre-Covid-19 levels. The company’s consumer-to-consumer segment, which generates about 87% of its top-line, posted a 3% decline in 2020. This was mainly due to low demand and COVID-19 related restrictions, which was mainly affecting its business from the retail sector. Location. That said, this was partially offset by a 38% increase in WU’s digital money transfer revenue, driven by an 81% increase in digital transactions. Gradual improvement in economic conditions and easing of lockdown restrictions is likely to boost transaction volumes from retail locations. Overall, this will likely help WU’s top-line and propel the stock up about 36% in the near term, making it a good investment opportunity.

But pre-Covid levels can only be achieved if there is an improvement in transaction volume from WU’s physical retail outlets or the increase in digital payments makes up for lost revenue. Apart from this, it is also important that the economic recovery is not hampered by the sudden increase in COVID-19 cases. Our conclusion. based on a detailed comparison of Western Union Company Stock During the 2008 Recession Versus Now In our dashboard analysis.

covid-19 crisis

Timeline of the Covid-19 crisis so far:

  • 12/12/2019: First cases of corona virus were reported in China
  • 1/31/2020: WHO declares a global health emergency.
  • 2/19/2020: Signs of effective containment in China and hopes of monetary easing by major central banks help S&P 500 reach record high
  • 3/23/2020: S&P 500 34% falls From the peak level seen on February 19, 2020, as COVID-19 cases outside China accelerated. Doesn’t help oil prices slump in mid-March amid Saudi-led price war
  • From 3/24/2020: S&P 500 95% recovery From the lows seen on March 23, 2020, with the Fed’s multi-billion dollar stimulus package keeping the economy afloat during a prolonged lockdown and the vaccination campaign, things are slowly returning to normalcy despite multiple waves of COVID infections. allowed to return.

Conversely, here’s how WU stock and the broader market fared during the 2007/2008 crisis.

2007-08 Crisis Timeline

  • 10/1/2007: Predicted pre-crisis peak in S&P 500 index
  • 9/1/2008 – 10/1/2008: Accelerated market decline corresponding to Lehman bankruptcy filing (9/15/08)
  • 3/1/2009: Lower levels predicted by the S&P 500 Index
  • 12/31/2009: Preliminary correction to levels before a quick decline (around 9/1/2008)

The performance of the WU and S&P 500 during the 2007-08 crisis

We see that WU stock fell from a level of more than $21 in September 2007 (the pre-crisis peak) to a level of about $11 in March 2009 (as the market declined), meaning that WU stock fell from a level of over $11 in its estimated Lost 47% from the pre-crisis peak. It peaked at over $19 in early 2010, after the 2008 crisis, an increase of 69% between March 2009 and January 2010. The S&P 500 index saw a 51% decline, falling from 1,540 in September 2007 to 757 in March. 2009. Between March 2009 and January 2010, it rose 48% to a level of 1,124.

Fundamentals of WU in recent years

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