MoneyGram: Impact Of Wal-Mart News Underappreciated, 40%+ Downside
- Walmart's new money transfer service will cause a significant reduction in MoneyGram's revenue.
- Walmart-2-Walmart transfers account for approximately 13.6% of MoneyGram's total revenue.
- Gross margin is approximately 40% on MoneyGram's Walmart-2-Walmart business, and it is unlikely that MoneyGram will be able to materially reduce SG&A costs.
- EPS may decline more than 50%, and the stock may fall more than 40%.