Daily Stock Analysis: Western Union
Source: Unsplash
The Western Union Co has the ticker symbol WU and is a member of the technology sector as an electronic transfer company. It has good value and average fundamental scores on its track record and is 20.54% underpriced based on its historic valuation. I last reported on WU in the last week of December 2020.
The Western Union Co has found favor with investors lately. WU dividends yield 3.8% while the company's free cash flow yield is 7.33% providing a 3.53% safety margin for the dividend.
Western Union provides domestic and international money transfers through its global network of about 500,000 outside agents.
It is the largest money transfer company in the world and one of only two companies with a truly global agent network, with MoneyGram being the other.
The Western Union Company was founded in 1851 and is headquartered in Denver, Colorado.
Three key data points gauge dividend equities or funds like The Western Union Company:
(1) Price
(2) Dividends
(3) Returns
Those three basic keys best tell whether a company has made, is making, and will make money.
WU Price
Western Union's price per share closed at $23.68 yesterday. A year ago its price was $23.05. Price per share has just recovered from the COVID recession, being 2.7% above last year's mark.
If The Western Union Co stock trades in the range of $18 to $28 this next year, its recent $23.05 price might rise by $2.32 to reach $26.00 by March 3, 2022. That's above the median of twenty-two WU broker analyst projections.
WU Dividends
Western Union's most recently declared quarterly dividend was $0.235 payable on March 31st. Dividends are estimated to total $0.94 per share annually and yield 3.97% at yesterday's $23.68 closing price. It has paid annually increasing dividends for six years
WU Returns
Adding the $0.94 annual WU anticipated dividend to my $2.32 price upside shows a $3.26 potential gross gain, per share, to be reduced by any costs to trade the shares.
Put little under $1,000.00 today in The Western Union Co at $23.68 per share and we'd buy 42 shares of WU stock.
A $10 broker fee (if charged) would be paid half at purchase and half at a sale and might cost us about $0.24 per share.
Subtract that maybe $0.24 brokerage cost from my estimated $3.26 gross gain per share results in a net gain of $3.02 X 42 shares = $126.84 for a 13.65% net gain on a $994.56 investment.
The Western Union Co shows a possible 13.65% net gain including a 3.97% dividend yield.
Over the next year at this time, a $1000 investment could generate $39.70 in cash dividends. And a single share bought at yesterday's closing price was under $24.00! So, if WU is your kind of transfer agent investment, the price is where the dividend income from $1,000 invested does exceed the single share price. You might consider this an opportunity to look closer at an investment in WU.
All of the estimates above are speculation based on the past history of The Western Union Co. Only time and money invested in this stock will determine its worth.
Disclaimer: This article is for informational and educational purposes only and should not be construed to constitute investment advice. Nothing contained herein shall constitute a solicitation, ...
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