Western Union CompanyWU

Morningstar Rating

Stock Research and Analysis

by Brett Horn

Industry growth, market opportunities, and considerable competitive advantages position Western Union for long-term success, in our opinion, although the near term is not so bright.
More than 200 million people live outside their country of origin, Read more

Bulls Say

With its relatively high margins, Western Union should be able to absorb any change in industry conditions better than its peers.

The fact that money transfer transaction volume continued to grow throughout the downturn suggests the historical drivers of Western Union's business will reassert themselves once a recovery takes hold.

Money transfers sent by immigrants back to their home countries typically are not discretionary, but cover the subsistence needs of their families. For instance, money transfers sent to El Salvador equal more than 15% of that country's gross domestic product. Read more

Bears Say

A weak global economy could limit immigrants' employment opportunities and damp money transfer volume, and conditions in Europe are a headwind.

Alternative channels for sending money, such as cell phones, could cut out money transfer companies like Western Union.

Management appears to have responded poorly to recent compliance issues in Mexico. Read more

Management

CEO Christina Gold headed the company from 2002 until 2010, when she was replaced by Hikmet Ersek, previously the COO. Given that Ersek has been with Western Union since 1999, we foresaw no major strategic shifts at the time of his ascension, and that Read more

Profile

Western Union provides domestic and international money transfers through its global network of more than 500,000 outside agents. It is the largest money transfer company Read more