Western Union (WU – Research Report), the Financial sector company, was revisited by a Wall Street analyst yesterday. Analyst Will Nance from Goldman Sachs maintained a Sell rating on the stock and has a $10.00 price target.
Will Nance has given his Sell rating due to a combination of factors impacting Western Union’s performance. The company reported a weaker than expected first quarter, with revenue falling short of projections despite a lower tax rate. The ongoing geopolitical issues have adversely affected cross-border flows, particularly from North America to Mexico, and changing migration patterns have further slowed down growth in the Latin America and Caribbean regions. Although there is strength in Consumer Services, the overall outlook remains uncertain, with management expressing less confidence in their guidance amidst a challenging geopolitical environment.
Additionally, Western Union is facing headwinds from the global shift towards digital remittances and the widening gap between transaction and revenue growth. The company’s exposure to changes in immigration policies worldwide also adds to the uncertainty. Despite these challenges, the stock is somewhat supported by a 10% dividend yield, and a dividend cut seems unlikely in the near term. However, stabilization in the retail business would be necessary for a more positive outlook on the stock.
Nance covers the Technology sector, focusing on stocks such as Affirm Holdings, Jack Henry & Associates, and NCR Voyix. According to TipRanks, Nance has an average return of -10.4% and a 41.78% success rate on recommended stocks.
In another report released today, Barclays also maintained a Sell rating on the stock with a $10.00 price target.