The Western Union Company
The Western Union Company Fundamental Analysis
The Western Union Company (WU) shows moderate financial fundamentals with a PE ratio of 5.86, profit margin of 12.33%, and ROE of 53.92%. The company generates $4.1B in annual revenue with weak year-over-year growth of -3.38%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 57.7/100 based on profitability, valuation, growth, and balance sheet metrics. The C grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze WU's fundamental strength across five key dimensions:
Efficiency Score
WeakWU struggles to generate sufficient returns from assets.
Valuation Score
ExcellentWU trades at attractive valuation levels.
Growth Score
ModerateWU shows steady but slowing expansion.
Financial Health Score
ExcellentWU maintains a strong and stable balance sheet.
Profitability Score
ModerateWU maintains healthy but balanced margins.
Key Financial Metrics
Is WU Expensive or Cheap?
P/E Ratio
WU trades at 5.86 times earnings. This suggests potential undervaluation.
PEG Ratio
When adjusting for growth, WU's PEG of -0.18 indicates potential undervaluation.
Price to Book
The market values The Western Union Company at 3.06 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 4.46 times EBITDA. This is generally considered low.
How Well Does WU Make Money?
Net Profit Margin
For every $100 in sales, The Western Union Company keeps $12.33 as profit after all expenses.
Operating Margin
Core operations generate 18.70 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $53.92 in profit for every $100 of shareholder equity.
ROA
The Western Union Company generates $6.02 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
The Western Union Company produces operating cash flow of $544.12M, showing steady but balanced cash generation.
Free Cash Flow
The Western Union Company produces free cash flow of $393.20M, offering steady but limited capital for shareholder returns and expansion.
FCF Per Share
Each share generates $1.24 in free cash annually.
FCF Yield
WU converts 13.49% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
5.86
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-0.18
vs 25 benchmark
P/B Ratio
Price to book value ratio
3.06
vs 25 benchmark
P/S Ratio
Price to sales ratio
0.72
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.00
vs 25 benchmark
Current Ratio
Current assets to current liabilities
16.52
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.54
vs 25 benchmark
ROA
Return on assets percentage
0.06
vs 25 benchmark
ROCE
Return on capital employed
0.09
vs 25 benchmark
How WU Stacks Against Its Sector Peers
| Metric | WU Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 5.86 | 18.73 | Better (Cheaper) |
| ROE | 53.92% | 847.00% | Weak |
| Net Margin | 12.33% | 3919.00% | Weak |
| Debt/Equity | 0.00 | 0.93 | Strong (Low Leverage) |
| Current Ratio | 16.52 | 674.76 | Strong Liquidity |
| ROA | 6.02% | -21563.00% (disorted) | Weak |
WU outperforms its industry in 3 out of 6 key metrics, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews The Western Union Company's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
0.04%
Industry Style: Value, Dividend, Cyclical
GrowingEPS CAGR
11.02%
Industry Style: Value, Dividend, Cyclical
High GrowthFCF CAGR
-44.13%
Industry Style: Value, Dividend, Cyclical
Declining