Douglas County-based Western Union Co., the world’s biggest money-transfer business, fell after PayPal purchased competitor Xoom Corp., prompting Evercore Partners Inc. to downgrade the stock.
Western Union closed on Thursday down 6.9 percent to $18.99. The shares had gained 14 percent this year through Wednesday.
PayPal’s agreement Wednesday to pay $890 million for Xoom, a service for sending international money transfers, will create “a large, global competitor for Western Union,” said Rayna Kumar, an Evercore analyst, in a note to clients.
Kumar lowered Western Union to hold from buy, and cut the price target to $20 a share from $23.
EBay Inc., which owns PayPal, announced plans last year to spin off the transaction business. The split is scheduled to occur this month.
