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Western Union (WU), first discussed here on July 9, 2009 at a price of $16.49, continues to meander, but the bias is to stay with the play. Western Union will likely post a 4-7% revenue gain for FY2010. However, the continued sluggish in construction work -- which has reduced day-labor demand for money transfer services -- has weighed on WU's revenue.
Further, even though U.S. workforce has most likely bottomed, with net staff additions up ahead, institutional investors (IIs) have not shown overwhelming enthusiasm for Western's shares, and as the old saying goes on Wall Street, 'you can't make money in a stock, until the big guns are making money in the stock.' Also, WU came close to hitting the sell/stop loss at $14.
Hence, Western Union' stock, according to my analysis, has three months to get-it-in-gear.
The First Call FY2010/FY2011 EPS estimates for WU are $1.32 to $1.45.
2010 Outlook: I view Western Union as a long-term play, but if investors are looking to sell WU within the year, I wouldn't purchase the shares, as the 1-year risk/return is not favorable.
Stock Analysis: I consider Western Union to be a moderate-risk stock. If an investor has already purchased the company's shares, I'd hold them. If not, I'd consider buying a 25% position in WU now. Under any circumstance, I wouldn't buy more than 50% of my WU position before April 2010 and I'd put a sell/stop loss at: $14.
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Disclosure: Lazzaro has no positions in stocks, but does own shares in two Pimco Bond Funds: PHDAX and PYMAX.
Hence, Western Union' stock, according to my analysis, has three months to get-it-in-gear.
The First Call FY2010/FY2011 EPS estimates for WU are $1.32 to $1.45.
2010 Outlook: I view Western Union as a long-term play, but if investors are looking to sell WU within the year, I wouldn't purchase the shares, as the 1-year risk/return is not favorable.
Stock Analysis: I consider Western Union to be a moderate-risk stock. If an investor has already purchased the company's shares, I'd hold them. If not, I'd consider buying a 25% position in WU now. Under any circumstance, I wouldn't buy more than 50% of my WU position before April 2010 and I'd put a sell/stop loss at: $14.
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Disclosure: Lazzaro has no positions in stocks, but does own shares in two Pimco Bond Funds: PHDAX and PYMAX.
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