Western Union calling! Tomorrow's the day that the famed money transfer service -- or rather, its parent company, First Data (NYSE:FDC) -- officially rings out the end of 2005 and lets us know its views on 2006.

Wall Street Wisdom:

  • General consensus. Wall Street loves First Data. Twenty-eight analysts devote their waking hours to tracking the stock's fortunes, and nearly two-thirds of them rate the stock a "buy," with 10 holdouts counseling -- what else? -- "hold."
  • Revenues. The analyst consensus on this score calls for muted revenue growth of just under 5% for the fourth quarter of 2005.
  • Earnings. Profits are believed to have grown a bit faster, up 8% to $0.65 per share.

Margin watch:
First Data's margins are a bit of a mixed bag. For a while there, it looked like gross and operating results were on a confirmed uptrend, but the business has been weakening in recent quarters, weighing on the firm's trailing 12-month average margins. Net results began faltering a few months before the business turned down. Higher interest rates resulted in higher payments on the firm's debt, and non-cash restructuring charges also took a toll.

Marg . %

6/04

9/04

12/04

3/05

6/05

9/05

Gross

39.2

39.7

40.1

40.1

39.4

38.9

Op.

24.4

25.2

25.5

25.7

25.4

25.1

Net

19.1

19.2

18.9

17.3

16.3

15.7
All data courtesy of Capital IQ, a division of Standard & Poor's. Data reflects trailing-12-month performance for the quarters ending in the named months.

Foolish lookout:
Two months ago, First Data laid much of the blame for its lackluster results at the door of its credit card division, with CEO Charlie Fote saying that the unit "continues to dampen the growth rates of the entire company." The firm seems intent on getting rid of the division, and has retained Morgan Stanley (NYSE:MS) to help with the task. Tomorrow, be on the lookout for any clues of progress on that front. (Conversely, don't be surprised if you see nothing; Fote noted that it could take as long as six months or more to find a buyer.)

Competitors:
First Data and its Western Union operation are the twin marquee names in payment transfer, but they're not the only games in town. Smaller rivals MoneyGram (NYSE:MGI), Fiserv (NASDAQ:FISV), and Total System Services (NYSE:TSS) continue to nip at their heels.

First Data is a Motley Fool Inside Value pick. To find more solid companies hiding in Wall Street's bargain bin, sign up today for a 30-day free trial subscription.

Fool contributor Rich Smith does not own shares of any company named above.