Lets take a look at Monet remittance companies. Western Union has revised its EPS for FY2012 from US$1.70 to $1.60, but its shares price have tumbled from US$18 to US$12. I have done an analysis between these 5 companies, Western Union, eBay ( owner of Paypal ), America Express , MoneyGram and Bank of America. In terms of market cap, MoneyGram who is in the same business as Western Union, is of much smaller scale as compared to Western Union,but trading at 12x PE ratio vs Western Union of 6x PE ratio. eBay,who owns Paypal, is trading at 18x which is much higher.
WU has announced a share repurchase of US$750 million of abt 10% of the market cap by end 2013. It also raised its dividend from US$0.40 per share to US$0.50 per share, paid quarterly US$0.125. As such, personally i will think WU is of much lower valuation, i will recommend a buy at US$12.
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