Western Union Expands Digital Business, Retains Leadership

On Jun 7, 2016, we updated our research report on Western Union Co. (NYSE:WU) . The company is one of the leaders in the money remittance market and is poised to benefit from a positive shift in long-term global immigration by virtue of its size and reach.

Western Union is eyeing long-term growth by maintaining leadership in the traditional retail money transfer business, extending leadership in digital money transfer, and leveraging its cross-border platform to serve new use cases and customer segments.

Moreover, Western Union derives a huge chunk of business from physical money transfer thanks to its wide agent network and market dominance in the money transfer industry. The company is now aggressively expanding its digital business. On this front, Western Union recently launched its mobile app for westernunion.com in Italy that will give Android and Apple (NASDAQ:AAPL) users access to Western Union’s money transfer services, a refresh mobile app in the U.K., a new mobile remittance receiving service in Bangladesh, and two new westernunion.com transaction sites in Europe. This takes the company’s online money transfer sending services to 36 countries in total.

Though the company is growing its digital business, it faces stiff competition in this field from established players such as PayPal Holdings, Inc. (NASDAQ:PYPL) .

Western Union’s international business is the jewel in its crown. More than 80% of its agents are based internationally, where Western Union faces less competition than the U.S. market.

Also, intelligent use of capital via share buyback is likely to drive its bottom line.

Western Union carries a Zacks Rank # 3 (Hold). Some better-ranked stocks in the space are Global Total System Services, Inc. (NYSE:TSS) and Fidelity National Information Services, Inc. (NYSE:FIS) . Both stocks carry a Zacks Rank #2 (Buy).

FIDELITY NAT IN (FIS): Free Stock Analysis Report

TOTAL SYS SVC (TSS): Free Stock Analysis Report

WESTERN UNION (WU): Free Stock Analysis Report

PAYPAL HOLDINGS (PYPL): Free Stock Analysis Report

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