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4-Star Stocks Poised to Pop: Western Union

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, money transfer agent Western Union (NYSE: WU  ) has earned a respected four-star ranking.

With that in mind, let's take a closer look at Western Union's business and see what CAPS investors are saying about the stock right now.

Western Union facts

Headquarters (Founded) Englewood, Colo. (1851)
Market Cap $11.0 billion
Industry Data processing and outsourced services
Trailing-12-Month Revenue $5.5 billion
Management CEO Hikmet Ersek (since 2010)
CFO Scott Scheirman (since 2006)
Return on Capital (Average, Past 3 Years) 23.1%
Cash/Debt $1.4 billion / $3.6 billion
Dividend Yield 2.2%
Competitors American Express
Moneygram International
PayPal

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 97% of the 1,501 members who have rated Western Union believe the stock will outperform the S&P 500 going forward.

Just last week, one of those Fools, All-Star joryko, tapped Western Union as a timely buying opportunity:

Good buying spot as it issued lower guidance for 2012 and dropped almost 10% instantly.

Consistently profitable with a history of beating estimates. Simple valuations are strong with a Forward P/E of 9-10 and 5 year PEG of only .9. Also boosted its dividend and continued its strong share repurchase policy with $800 million bought back in 2011.

Western Union's operating margins also increased 100 basis points from 2010 and they continue to hold over $2 in cash per share.

Buying for the 2 to 4 year outlook.

If you want to retire rich, you need to put together the best portfolio you can. Owning exceptional stocks is a surefire way to secure your financial future. Of course, despite a strong four-star rating, Western Union may not be your top choice.

We've found another stock we are incredibly excited about -- excited enough to dub it "The Motley Fool's Top Stock for 2012." We have compiled a special free report for investors to uncover this stock today. The report is 100% free, but it won't be here forever, so click here to access it now.

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Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Motley Fool newsletter services have recommended buying shares of and creating a write covered straddle position in Western Union. Motley Fool newsletter services have also recommended creating a write covered strangle position in American Express. Try any of our Foolish newsletter services free for 30 days.

We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.


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Brian Pacampara
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I take a look at big 10% moves, as well as stock-shaking analyst calls, on a daily basis for The Fool. While I don't believe in active trading, closely monitoring Mr. Market's mood swings can help identify long-term opportunities.

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Related Tickers

10/21/2014 1:06 PM
WU $16.41 Up +0.26 +1.62%
Western Union CAPS Rating: ***

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