Weekly Dividend Stock Ideas Researched by The Dividend Yield Weekly. Our weekly Dividend Idea is the global payment services stock Western Union (NYSE:WU). The money transfer company was sold-off by many investors after the disappointing the third-quarter results of the company. The company announced a 1% increase in sales and raised dividends by 25 percent and increased share buybacks to $750 million, but lowered the guidance in accordance to lower second-half revenues and a higher competition. The stock dropped around thirty percent and the current dividend yield after the dividend hike is over 4% at a P/E ratio of less than 7. Morningstar analysts estimated the fair value of the company at $25.0 which represents a potential to double. Source: http://long-term-investments.blogspot.com

1. The Dividend Idea
(A Snapshot of attractive Dividend Stocks)
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44/2012(2012-11-03)

2. The Dividend Idea
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Content:
1. Summary
2. Price Facts
3. Long-Term Price Ratios And Margins
4. Income Statement
5. Balance Sheet
6. Cash Flow Statement
7. Peer-Fact Sheet
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3. The Dividend Idea
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Company Summary:
The Western Union Company (Western Union) is engaged in money move-
ment and payment services. The Company’s business payments service pro-
vides consumers and businesses with options for making one-time or recur-
ring bill payments, including business-to-business payment transactions,
which are primarily cross-border, cross currency transactions. Its segments
are consumer-to-consumer and global business payments. Its other busi-
nesses not included in these segments primarily consist of Western Union
money order and prepaid services available through a network of third-party
agents. In April 2011, the Company acquired Angelo Costa, S.r.l. In August
2011, the Company formed Western Union Ventures. In October 2011, the
Company acquired Finint S.r.l. In November 2011, the Company acquired the
business-to-business payment business of Travelex Holdings Limited, known
as Travelex Global Business Payments.
2.5 900
800
2 700
EPS Data in USD
Shares in million
600
1.5
500
400
1
300
0.5 200
100
0 0
2002-12 2004-12 2006-12 2008-12 2010-12 TTM
Earnings Per Share USD Dividends USD Shares Mil
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4. The Dividend Idea
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Price Facts NYSE:WU
Stock Price Estimated Value* Potential Rating Points**
11.95 25.00 109.21% 10/10
Size Category Sector Industry
Mid Cap Growth Financial Business Services
Value Services
Dividend Challenger
P/E 6.13 # Yrs Dividend Growth 5
Fwd P/E 6.26 Dividend Growth Rate 1Y 25.00%
P/S 1.27 Dividend Growth Rate 3Y 27.78%
P/B 6.87 Dividend Growth Rate 5Y 25.59%
Dividend Yield 4.18% Dividend Growth Rate 10Y N/A
PEG 0.9 EPS Last 10 Years 11.39
PEG Payback 4.3 Dividends Paid Past 10Y 0.71
EV/EBITDA 5.42 Payout 19.0%
Market Capitalization 7.2B Cash MRQ 1.43B
EBITDA TTM 1.69B Debt MRQ 3.43B
* Estimated By Morningstar ** Rated By StockScouter
512
256
128
64
32
16
8
4
2
1
12/03 12/05 12/07 12/09 12/11
AVG P/E PRICE/ SALES PRICE/ BOOK
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5. The Dividend Idea
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Margin
Year AVG PRICE/ PRICE/ BOOK DEBT/ Operating Net Profit ROE in % ROA in %
P/E SALES BOOK VALUE EQUITY Margin in % in %
12/11 10.3 2.11 12.64 0.89 5.65 25.20 21.20 157.75 11.50
12/10 12.6 2.39 20.84 0.51 8.62 25.00 17.50 194.38 11.50
12/09 13.7 2.6 36.61 -0.01 -388.09 25.20 16.70 491.49 16.50
12/08 17.2 2 -1256.25 0.07 65.84 25.70 17.40 0.00 14.80
12/07 19.4 3.83 359.08 -0.41 -10.56 27.00 17.50 0.00 17.00
12/06 17.9 3.85 -54.92 3.67 0.06 29.30 20.40 73.21 20.00
12/05 NA NA NA 2.53 0.01 31.80 23.30 32.98 22.20
12/04 NA NA NA 0 0 0.00 21.20 0.00 0.00
12/03 NA NA 0 0 0 0.00 20.10 0.00 0.00
12/02 0 0 0 0 0 30.00 0.00 35.12 0.00
Average 13.01 2.40 -110.25 0.73 -31.85 21.92 17.53 98.49 11.35
600
500
400
300
200
100
0
2002-12 2004-12 2006-12 2008-12 2010-12 TTM
Gross Margin % Operating Margin %
Return on Equity % Return on Invested Capital %
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6. The Dividend Idea
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Income Statement
Fiscal year ends in December. USD in millions except per share data.
2007-12 2008-12 2009-12 2010-12 2011-12
Revenue 4,900 5,282 5,084 5,193 5,491
Other expenses 770 834 926 914 1,004
Total operating expenses 770 834 926 914 1,004
Operating income 4,130 4,448 4,158 4,278 4,487
Interest expense 189 171 158 170 182
Other income (expense) 89 55 7 15 72
Total nonoperating income, net -100 -116 -151 -155 -110
Income before taxes 4,031 4,332 4,006 4,124 4,377
Provision for income taxes 365 320 283 235 109
Other income (expense) -2,808 -3,093 -2,875 -2,978 -3,102
Net income 857 919 849 910 1,165
Net income available to common shareholders 857 919 849 910 1,165
Basic 1.13 1.26 1.21 1.37 1.85
Diluted 1.11 1.24 1.21 1.36 1.84
Basic 760 730 699 666 631
Diluted 773 738 701 669 634
6,000
5,000
4,000
3,000
2,000
1,000
0
2002-12 2004-12 2006-12 2008-12 2010-12 TTM
Revenue USD Mil Operating Income USD Mil
Net Income USD Mil
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7. The Dividend Idea
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Balance Sheet
Fiscal year ends in December. USD in millions except per share data.
2007-12 2008-12 2009-12 2010-12 2011-12
Cash and cash equivalents 1,997 1,296 1,685 2,157 2,083
Receivables 944 1,104 131 64 1,047
Property and equipment 200 192 204 196 198
Goodwill 1,640 1,674 2,143 2,152 3,199
Other intangible assets 334 351 489 438 847
Other assets 669 962 2,613 2,836 1,654
Total assets 5,784 5,578 7,353 7,929 9,070
Payables and accrued expenses 350 767 1,020 877 837
Taxes payable 0 382 519 357 302
Long-term debt 2,500 3,144 3,048 3,290 3,583
Deferred taxes 264 270 269 290 390
Other liabilities 1,782 1,024 2,143 2,533 3,062
Total liabilities 5,734 5,586 7,000 7,346 8,175
Stockholders' equity 0 0 0 0 0
Common stock 8 7 7 6 6
Additional paid-in capital -341 -14 41 117 247
Retained earnings 453 29 433 592 760
Accumulated other comprehensive income -69 -30 -127 -133 -118
Total stockholders' equity 51 -8 354 583 895
Total liabilities and stockholders' equity 5,784 5,578 7,353 7,929 9,070
70
60
Assets in % of Balance Sheet
50
40
30
20
10
0
2002-12 2004-12 2006-12 2008-12 2010-12 TTM
-10
Cash & Short-Term Investments Intangibles
Short-Term Debt Long-Term Debt
Total Stockholders' Equity
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8. The Dividend Idea
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Cash Flow Statement
Fiscal year ends in December. USD in millions except per share data.
2007-12 2008-12 2009-12 2010-12 2011-12
Net income 857 919 849 910 1,165
Depreciation & amortization 124 144 154 176 193
Net cash provided by operating activities 1,104 1,254 1,218 994 1,175
Net cash used for investing activities -202 -454 -324 -65 -1,360
Debt issued 0 500 497 247 993
Debt repayment 0 -755 -583 0 -696
Repurchases of treasury stock -727 -1,314 -400 -581 -804
Dividend paid -30 -28 -41 -165 -194
Other financing activities 11 300 23 42 100
Net cash provided by (used for) financing activities
-530 -1,298 -504 -458 -601
Net change in cash 371 -498 390 472 -786
Cash at beginning of period 1,422 1,793 1,296 1,685 2,157
Cash at end of period 1,793 1,296 1,685 2,157 1,371
Operating cash flow 1,104 1,254 1,218 994 1,175
Capital expenditure -192 -71 -99 -114 -162
Free cash flow 911 1,183 1,119 881 1,012
Cash paid for income taxes 0 230 163 365 145
Cash paid for interest 0 172 150 176 191
1,400
1,200
1,000
800
600
400
200
0
-200 2002-12 2004-12 2006-12 2008-12 2010-12 TTM
-400
Operating Cash Flow USD Mil Cap Spending USD Mil
Free Cash Flow USD Mil
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9. The Dividend Idea
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Company Ticker Mcap P/E P/B P/S Yield
Visa, Inc. V 116.32B 141.98 4.44 11.55 0.92%
American Express Company AXP 63.63B 13.13 3.35 1.9 1.41%
eBay Inc. EBAY 63.00B 16.62 3.17 4.68 -
Mastercard Incorporated MA 58.59B 28.06 9.36 8.22 0.26%
Fiserv, Inc. FISV 10.21B 18.35 3.14 2.3 -
FleetCor Technologies, Inc. FLT 3.97B 23.02 4.21 6.69 -
Global Payments Inc. GPN 3.41B 20.03 2.97 1.52 0.18%
Wright Express Corp. WXS 2.75B 20.59 3.64 4.7 -
Cash America International, Inc. CSH 1.14B 10.24 1.16 0.64 0.36%
Heartland Payment Systems, Inc. HPY 1.10B 20.68 4.68 0.55 0.85%
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10. The Dividend Idea
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