The 10-second takeaway
For the quarter ended Sep. 30 (Q3), Western Union missed estimates on revenues and beat slightly on earnings per share.
Compared to the prior-year quarter, revenue increased slightly and GAAP earnings per share expanded significantly.
Gross margins grew, operating margins dropped, net margins grew.
Western Union tallied revenue of $1.42 billion. The 25 analysts polled by S&P Capital IQ predicted a top line of $1.47 billion on the same basis. GAAP reported sales were 0.8% higher than the prior-year quarter's $1.41 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.46. The 26 earnings estimates compiled by S&P Capital IQ averaged $0.45 per share. GAAP EPS of $0.45 for Q3 were 18% higher than the prior-year quarter's $0.38 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 44.0%, 50 basis points better than the prior-year quarter. Operating margin was 25.7%, 100 basis points worse than the prior-year quarter. Net margin was 19.0%, 200 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $1.39 billion. On the bottom line, the average EPS estimate is $0.36.
Next year's average estimate for revenue is $5.76 billion. The average EPS estimate is $1.76.
The stock has a five-star rating (out of five) at Motley Fool CAPS, with 1,469 members out of 1,516 rating the stock outperform, and 47 members rating it underperform. Among 382 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 374 give Western Union a green thumbs-up, and eight give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Western Union is outperform, with an average price target of $21.74.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool owns shares of Western Union. Motley Fool newsletter services recommend Western Union. 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 Motley Fool has a disclosure policy.