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Sunday, December 6, 2020

MoneyGram International Inc. (NASDAQ:MGI) Stock is Plummeting, Here is Why

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MoneyGram International Inc. (MGI) shares are trading at lower $3.15 and the avg recommendation for the stock is Hold. while the current analyst price target stands at $2.33.

To add more color to this target, the company’s high over the last year is $6.70 and the low is $1.15. Over the last 52 weeks, MGI is down -12.50% while the S&P 500 is up 16.12%%. The catalyst for this interesting swing was the company’s recent earnings report.

A Notable Earnings Report

In the last quarter, MGI reported a profit of $105.6 million. MoneyGram International Inc. also saw revenues increase to $279.8 million. In addition, MGI has free cash flow of -$12.3 million as of 06-2020. The company’s EBITDA came in at $70.8 million which compares well with its peers.

MGI booked profit margins of -3.80%, its Return on Equity (ROE) is 10.40%, and its Return on Assets is -1.10%. All told, it is clear that, MGI needs to be on your watchlist.

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Of course, we must look beyond the financials and question how well those numbers represent the sustainable earnings power of the business. Investors need to know how sustainable this current run. MGI has a short ratio of 1.01 and outstanding shares of 77.80M.

Company Outlook

MGI has seen increased volume after this news and investors are putting their support behind the value proposition. Traders will also note the company’s earnings per share came in at -0.58. MoneyGram International Inc. MGI also noted assets of $4.42 billion at the end of the last quarter. Investors should also keep an eye on sector updates as MGI has historically followed its peers on positive news.

All told, MoneyGram International Inc. MGI has strung together solid data and demonstrated underlying fundamentals. At its current valuation, MGI represents an interesting risk/reward case. Traders should stay tuned to see if this recent report will push the stock to test recent resistance levels.

MoneyGram International Inc. MGI is now commanding a market cap of 209.10M and a float of 55.05M. MGI is increasing its credibility in this sector and that could lead to more upside down the line. Sign-up for continuing coverage on shares of MGI stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!

Disclosure: we hold no position in MGI, either long or short, and we have not been compensated for this article.

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