DA Davidson Downgrades Western Union (WU) to Neutral
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DA Davidson downgrades Western Union (NYSE: WU) from Buy to Neutral and maintains its $26 price target.
The firm attributed the downgrade to valuation: its $26 price target is based on a "fully-valued 2009
P/E of 18x and an EV/EBITDA multiple of 12x." As this price target only represents an 8% gain from yesterday's closing price of $23.95, DA Davidson said it can no longer justify a Buy rating.
DA Davidson also cites data from Banco de Mexico that prices are stabilizing in the industry, possibly showing early signs of improvement, although remittances are "still well below levels seen in past years."
The Western Union Company provides a range of money transfer and bill payment services worldwide.
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Patrick Smyth on Jun 4, 2008 03:56 PMWU might want to work on its customer support. I did a wire over the phone and had to spell out the following words: "Miami and Florida".