Western Union Third Quarter Earnings Sneak Peek

S&P 500 (NYSE:SPY) component Western Union (NYSE:WU) will unveil its latest earnings on Tuesday, October 30, 2012. Western Union is engaged in global money transfer and payment services.

Western Union Earnings Preview Cheat Sheet

Wall St. Earnings Expectations: The average analyst estimate is for profit of 45 cents per share, a rise of 12.5% from the company’s actual earnings for the year-ago quarter. The average estimate is the same as three months ago. Between one and three months ago, the average estimate was unchanged. It also has not changed during the last month. Analysts are projecting profit to rise by 12.1% versus last year to $1.76.

Past Earnings Performance: Last quarter, the company topped estimates by 0 cents, coming in at net income of 46 cents per share against a mean estimate of profit of 43 cents. The company fell in line with estimates in the first quarter.

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Wall St. Revenue Expectations: Analysts are projecting a rise of 4.3% in revenue from the year-earlier quarter to $1.47 billion.

Stock Price Performance: Between August 28, 2012 and October 24, 2012, the stock price had risen 65 cents (3.8%), from $17.33 to $17.98. The stock price saw one of its best stretches over the last year between August 30, 2012 and September 14, 2012, when shares rose for 11 straight days, increasing 9.8% (+$1.70) over that span. It saw one of its worst periods between October 5, 2012 and October 15, 2012 when shares fell for seven straight days, dropping 3.4% (-63 cents) over that span.

A Look Back: In the second quarter, profit rose 3% to $271.2 million (44 cents a share) from $263.2 million (41 cents a share) the year earlier, exceeding analyst expectations. Revenue rose 4.3% to $1.43 billion from $1.37 billion.

Key Stats:

After experiencing income increases the last three quarters, the company is hoping to keep the good news coming with this earnings announcement. Net income rose 86.4% in the fourth quarter of the last fiscal year and 17.6% in the first quarter before increasing again in the second quarter.

On the top line, the company is looking to build on four-straight revenue increases heading into this earnings announcement. Revenue rose 6.1% in the third quarter of the last fiscal year, 5.5% in the fourth quarter of the last fiscal year and 39.6% in the first quarter before increasing again in the second quarter.

Analyst Ratings: With 13 analysts rating the stock a buy, one rating it a sell and 10 rating the stock a hold, there are indications of a bullish stance by analysts.

Balance Sheet Analysis: The company’s current ratio of assets to liabilities came in at 1.08 last quarter. The current ratio is an indication of a firm’s liquidity and ability to meet creditor demands and generally, for every dollar the company owes in the short term, it has that figure available in assets that can be converted to cash in the short term. The company regressed in this liquidity measure from 1.16 in the first quarter to the last quarter driven in part by an increase in liabilities. Current liabilities increased 6% to $4.18 billion while assets decreased 1.6% to $4.51 billion.

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(Company fundamentals by Xignite Financials. Earnings estimates provided by Zacks)

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