Deutsche Bank Downgrades Western Union Co. (WU) to Hold

Deutsche Bank downgraded Western Union Co. (NYSE: WU) from Buy to Hold with a price target of $20.00 (from $19.00). The change follows recent stock strength.

Analyst Bryan Keane said, "WU reported revenues of $1.41bn (-0.8%, 4% cc) which came in slightly below our rev est. of $1.42bn due to FX while EPS of $0.42 (includes $0.04 of tax benefit) beat our est. of $0.33 handily driven by better-than-expected margins. WU guided to 21% op margins in FY15 (up from 20% in FY14) which includes the benefit of cost saving initiatives and hedging gains ($70m of benefit, 1pt of margin benefit). Positively, EPS guidance for FY15 was slightly better than our $1.57 estimate ($1.58-$1.65) and WU announced a new 3 yr $1.2B buy back and a 24% increase in the dividend."

"We are raising our FY15 EPS by $0.04 to $1.61 and issuing our FY16 EPS of $1.67. Given the recent strength of the shares and an uncertain margin and revenue outlook beyond FY15, we are downgrading the shares to Hold from Buy and setting a $20TP," he added.

For an analyst ratings summary and ratings history on Western Union Co. click here. For more ratings news on Western Union Co. click here.

Shares of Western Union Co. closed at $18.40 yesterday.

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