The Western Union Company WU is set to report its fourth-quarter 2024 results on Feb. 4, after the closing bell. The Zacks Consensus Estimate for the to-be-reported quarter’s earnings is currently pegged at 42 cents per share on revenues of $1 billion.
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The fourth-quarter earnings estimate remained stable over the past month. The bottom-line projection indicates year-over-year growth of 13.5%. However, the Zacks Consensus Estimate for quarterly revenues suggests a year-over-year decline of 2.5%.
For 2024, the Zacks Consensus Estimate for Western Union’s revenues is pegged at $4.2 billion, implying a decline of 4.1% year over year. The consensus mark for 2024 earnings is pegged at $1.77 per share, implying an increase of 1.7%, year over year.
Western Union beat the earnings estimates in three of the last four quarters and met once, with the average surprise being 5%. This is depicted in the figure below.
The Western Union Company Price and EPS Surprise
The Western Union Company price-eps-surprise | The Western Union Company Quote
Q4 Earnings Whispers
Our proven model does not conclusively predict an earnings beat for Western Union this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here, as you will see below. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Earnings ESP: The company has an Earnings ESP of 0.00%.
Zacks Rank: Western Union currently carries a Zacks Rank #3.
What’s Shaping WU’s Q4 Results?
Lower transactions in multiple regions are expected to have affected WU’s Consumer Money Transfer (CMT) segment in the fourth quarter. Reduced revenues in Europe and the Commonwealth of Independent States regions, the Middle East, Africa, South Asia and Asia Pacific operations are also expected to have affected the results.
The consensus mark for the unit’s revenues implies a more than 4% decrease from the year-ago period’s $975.5 million, whereas our model estimate suggests a 4.9% decline. However, the Zacks Consensus Estimate indicates that CMT transactions will grow 0.5% year over year to 73.3 million in the fourth quarter. This is likely to have partially offset the negatives. The consensus estimate for the CMT business’ operating income indicates 21.2% growth from the year-ago period.
The Zacks Consensus Estimate for revenues from the Consumer Services segment implies 14.9% year-over-year growth. However, the consensus estimate and our model estimate for operating income from the Consumer Services unit suggest a 17.7% decline from the year-ago period.
The above-mentioned factors are likely to have positioned the company for a year-over-year decline and made earnings beat uncertain. However, our estimate for total operating expense implies a 7.9% decline from a year ago due to lower cost of service, which will provide some impetus to the margins, partially offsetting the negatives.
Stocks That Warrant a Look
While an earnings beat looks uncertain for Western Union, here are some companies from the broader Business Services space that you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this time around:
Coinbase Global, Inc. COIN has an Earnings ESP of +51.52% and a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Coinbase Global’s bottom line for the to-be-reported quarter is pegged at 87 cents per share. The estimate remained stable over the past week. COIN beat earnings estimates in three of the past four quarters, meeting once, with an average surprise of 341.4%.
Fidelity National Information Services, Inc. FIS has an Earnings ESP of +0.41% and is a Zacks #2 Ranked player.
The Zacks Consensus Estimate for Fidelity National’s bottom line for the to-be-reported quarter is pegged at $1.35 per share, which remained stable for the past week. It beat earnings thrice in the past four quarters and missed once. Furthermore, the consensus mark for FIS’ revenues is pegged at more than $2.6 billion.
S&P Global Inc. SPGI has an Earnings ESP of +0.83% and a Zacks Rank of 2.
The Zacks Consensus Estimate for S&P Global’s bottom line for the to-be-reported quarter is pegged at $3.41 per share, indicating 9% year-over-year growth. SPGI beat earnings estimates in three of the past four quarters and missed once, with an average surprise of 6.3%.
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