Western Union Earnings: Reported Results Are Weak, but Underlying Results Steady

Western Union’s reported results were negatively impacted by the fact that the company lapped a temporary spike in revenue in Iraq last year. We think the market may respond negatively to the sizable year-over-year revenue decline this created, but we think underlying results suggest that management’s efforts to stabilize the business remain on track. We will maintain our $17 fair value estimate for the narrow-moat company and see shares as undervalued.