Barrons said today that Western Union Co (WU) could be worth as much as $35 a share citing some investors and an analyst. That’s a great endorsement and you can bet it’s going to move the stock which finished the day up 2% to $23 a share.

The article titled: Western Union: ATM to the World (click here to read) said Western Union shares are cheap, given the company’s efficient global money-transfer business and growth opportunities. The stock could gain 20% or more and Robert Loest, a senior portfolio manager at Integrity Growth and Income Fund, who calls the stock a “temporary steal” believes that it is worth $35.

The article goes on to say:

Warren Buffett’s Berkshire Hathaway dumped the final three million shares of its 10-million-share position in the third quarter of 2007, following Western Union’s spinoff from First Data in September 2006.

Was Buffett too quick to sell? Very possibly. CEO Christina Gold has addressed the problems. The shares, even after recent gains, remain cheap, and a high-margin business speeding money around the globe is pretty appealing, particularly if U.S. growth starts to sag.

Western Union has 320,000 agents handling transfers in more than 200 countries, where it is able to piggyback on existing infrastructure like postal or grocery outlets that keep its capital investment relatively small and the prospect of 20% returns possible. And it’s serving a huge marketplace as workers increasingly range the globe. The World Bank estimates there are now nearly 200 million immigrants — about 3% of the global population.

“People don’t understand how global we are and what an international growth opportunity we have here to grow market share, putting the right agents and offerings together with the right technology,” says Scott Scheirman, chief financial officer.

There are two main operating segments: The consumer-to-consumer portion consists of payments made between family members both within countries and across borders. In 2006, it totaled 70% of revenue and 80% of profit, and produced a 24% return on assets. Smaller but higher-margin, the consumer-to-business part involves individual bill-payments to big entities like utilities and mortgage companies. This segment constituted just 14% of revenue and 17% of profit, but produced a 29% return on assets.

You don’t buy companies like this when things are going well,” says Robert Loest, a senior portfolio manager at Integrity Growth and Income Fund (IGIAX), which holds 70,000 shares. The stock, he says, is a “temporary steal….This is a good example of a business model that is perched upon the transfer of labor from poor countries to wealthier ones.” He thinks the stock is worth $35.

“Warren Buffett is a great investor, but he can be wrong,” says Loest. Shareholders sure hope so.

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