Western Union (WU) reported a mixed Q4 2024, with GAAP revenues of $1.058 billion, slightly surpassing Citi's estimate of $1.037 billion, driven by higher Consumer Services revenue. However, the operating margin fell short due to a lower Consumer Money Transfer margin. Adjusted EPS of $0.40 missed Citi's forecast by 2-3 cents. The FY25 outlook remains consistent, projecting 1% adjusted revenue growth, excluding Iraq, and an operating profit margin of 19-21% (adjusted).
Citi maintains a "Neutral" rating with a $10.00 target price, citing Western Union's ongoing transformation and digital growth potential. However, challenges persist, including macroeconomic risks, competitive pressures, and changes in migration patterns. "We view risk reward as balanced and look for more turnaround proof points," Citi notes, emphasizing the need for improved digital revenue growth and retail stability.
Western Union's stock was trading at $10.37, down 0.1% on February 5.