Goldman Sachs Downgrades Western Union to a “Sell” (WU)
Goldman Sachs reported on Wednesday that they have downgraded payment services company, The Western Union Company(WU) to a “Sell.”
The firm has lowered its rating on WU from “Neutral” to “Sell,” and has reduced its price target for the company from $14 to $12. This price target suggests a -14% decline from the stock’s current price of $13.67.
An analyst from the firm noted, “we downgrade WU to Sell from Neutral as we believe that some of the pricing and competitive pressure discussed by management during their 3Q12 results could be structural in nature. We have lowered our margin assumptions significantly, moreover, as we believe that both the price compression in its core remittance business and lackluster growth in its B2B business will weigh on the company’s near-term margin profile.”
Western Union shares were down 29 cents, or -2.12% during premarket trading Wednesday. The stock has declined -25% in the past year.
The Bottom Line
Shares of Western Union (WU) have a 3.66% dividend yield, based on last night’s closing stock price of $13.67. The stock has technical support in the $12 price area. If the shares can firm up, we see overhead resistance around the $16 price level.
The Western Union Company(WU) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.0 out of 5 stars.
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