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1. Company Snapshot

1.a. Company Description

The Western Union Company provides money movement and payment services worldwide.The company operates in two segments, Consumer-to-Consumer and Business Solutions.The Consumer-to-Consumer segment facilitates money transfers between two consumers, primarily through a network of third-party agents and sub-agents; and offers international cross-border transfers and intra-country transfers, as well as money transfer transactions through websites and mobile devices.


The Business Solutions segment provides payment and foreign exchange solutions, primarily cross-border and cross-currency transactions for small and medium size enterprises, other organizations, and individuals; and foreign currency forward and option contracts.It also offers bill payment services that facilitates payments from consumers to businesses and other organizations, as well as offers money order and other services.The company was founded in 1851 and is headquartered in Denver, Colorado.

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1.b. Last Insights on WU

The Western Union Company's recent performance was positively driven by its Q3 earnings beat, with the company reporting $0.47 per share, exceeding the Zacks Consensus Estimate of $0.43 per share. The company's Consumer Services (CS) unit revenue jumped 49% year-over-year, while cost cuts boosted margins. Despite weakness in the CMT segment, management reiterated its 2025 adjusted EPS guidance within $1.65-$1.75. Additionally, the company's stablecoin fintech initiative and attractive 11% dividend yield have drawn investor attention, with some analysts rating WU as a Buy.

1.c. Company Highlights

2. Western Union's Q3 2025 Earnings: A Resilient Performance

Western Union reported a solid third quarter with revenue of $1.033 billion, a 1% decline year-over-year excluding Iraq. The company's adjusted operating margins were 20%, up from 19% in the prior year period, driven by cost management discipline. Adjusted EPS was $0.47, beating estimates of $0.43, benefiting from fewer shares outstanding. The company's consumer money transfer transaction growth was down 2.5%, while cross-border principal growth was up mid-single digits on a constant currency basis.

Publication Date: Oct -27

📋 Highlights
  • Revenue Decline Mitigated:: Reported $1.033B revenue, down 1% YoY excluding Iraq, with cross-border principal up mid-single digits (constant currency).
  • Digital Transformation Momentum:: Branded digital business grew transactions by 12% and adjusted revenue by 6%, now accounting for over 40% of global principal moved.
  • Consumer Services Surge:: Adjusted revenue surged 49% YoY, driven by Euro Change acquisition and $100M in Travel Money revenue (projected $150M in 2026).
  • Strong Cash Flow & Returns:: Generated $400M operating cash flow YTD, returned $400M to shareholders via buybacks/dividends, and maintained $1B cash reserves.
  • 2025 Outlook Optimistic:: Adjusted revenue guided to $4.035–$4.135B, with adjusted EPS of $1.65–$1.75 (trending to the high end), driven by digital-first strategies and operational efficiency.

Segment Performance

The company's Consumer Services segment has accelerated since the first quarter, driven by the acquisition of Euro Change, with adjusted revenue up 49% in the third quarter. The branded digital business grew adjusted revenue by 6% and transactions by 12%, driven by partnerships in the Middle East. The company's retail business in Europe saw mid-single-digit transaction and revenue growth.

Digital Transformation

Western Union is making significant progress in becoming a more digital-centric company, with its branded digital business delivering 8 consecutive quarters of mid-single-digit or better revenue growth. The company's digital business now accounts for over 40% of the principal it moves around the world. As CFO Matthew Cagwin noted, "We're expanding our payout capabilities to meet evolving customer needs, with digitally initiated payouts growing over 40% and now accounting for over 50% of all principal sent from our branded digital business."

Financial Position and Outlook

The company has generated over $400 million in operating cash flow year-to-date and maintains a strong balance sheet with $1 billion in cash and cash equivalents and $2.6 billion in debt. Western Union's 2025 outlook assumes no material changes in macroeconomic conditions, with adjusted revenue expected to be in the range of $4.035 billion to $4.135 billion, and adjusted operating margins between 19% and 21%. Analysts estimate next year's revenue growth at 0.5%.

Valuation

Western Union's current valuation metrics indicate a relatively attractive price. The company's P/E Ratio is 3.83, P/B Ratio is 3.19, and P/S Ratio is 0.71. Additionally, the Dividend Yield is 10.48%, and Free Cash Flow Yield is 13.9%. These metrics suggest that the stock may be undervalued, considering its financial performance and growth prospects.

3. NewsRoom

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The Western Union Company (WU) Presents at UBS Global Technology and AI Conference 2025 Transcript

Dec -03

Source: seekingalpha.com

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The Western Union Company $WU Position Trimmed by Ensign Peak Advisors Inc

Dec -01

Source: defenseworld.net

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Mercurity Fintech (NASDAQ:MFH) and Western Union (NYSE:WU) Financial Survey

Dec -01

Source: defenseworld.net

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Western Union: A Cigar Butt With An Outsized Puff Left

Nov -27

Source: seekingalpha.com

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The Western Union Company (WU) Presents at Citi's 14th Annual FinTech Conference Transcript

Nov -19

Source: seekingalpha.com

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The Western Union Company (WU) Presents at J.P. Morgan 2025 Ultimate Services Investor Conference Transcript

Nov -18

Source: seekingalpha.com

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Western Union: A High-Yield Cash Machine At 5x Earnings

Nov -15

Source: seekingalpha.com

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Why One Investor Is Betting $30 Million on Western Union Despite 16% Stock Slide

Nov -11

Source: fool.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (10.29%)

6. Segments

Consumer Money Transfer

Expected Growth: 10.47%

The 10.47% growth in Consumer Money Transfer from The Western Union Company is driven by increasing cross-border transactions, rising demand for digital money transfer services, and expansion into new markets. Additionally, strategic partnerships, improved customer experience, and competitive pricing also contribute to this growth.

Other

Expected Growth: 8.23%

The Western Union Company's 8.23% growth in 'Other' segment is driven by increasing demand for cross-border payments, expansion of digital channels, and strategic partnerships. Additionally, the company's diversified revenue streams, including cash-based and digital transactions, contribute to its growth. Furthermore, the company's strong brand recognition and extensive global network also support its growth momentum.

Business Solutions

Expected Growth: 8.5%

Western Union's 8.5% growth in Business Solutions is driven by increasing demand for cross-border payment solutions, expansion into new markets, and strategic partnerships. Additionally, the company's investment in digital transformation, enhanced customer experience, and competitive pricing strategies have contributed to its growth momentum.

7. Detailed Products

Money Transfer

Allows customers to send and receive money across the globe through various channels such as online, mobile, and retail locations.

Bill Payment

Enables customers to pay bills online or in-person at Western Union locations.

Prepaid Cards

Offers prepaid debit cards that can be loaded with funds and used to make purchases online or in-store.

Money Orders

Provides a secure way to make payments with a guaranteed form of payment.

Business Payments

Offers payment solutions for businesses to make international payments and manage cash flow.

Digital Money Transfer

Allows customers to send and receive money digitally through the Western Union app or website.

8. The Western Union Company's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes for Western Union is moderate due to the presence of alternative money transfer services such as PayPal, Xoom, and TransferWise. However, Western Union's strong brand recognition and extensive network of agents help to mitigate this threat.

Bargaining Power Of Customers

The bargaining power of customers is low due to the lack of concentration of buyers in the money transfer market. Individual customers have limited negotiating power, and Western Union's large customer base helps to reduce the impact of any individual customer's bargaining power.

Bargaining Power Of Suppliers

The bargaining power of suppliers is low due to the large number of agents and partners that Western Union works with. This reduces the dependence on any individual supplier, giving Western Union greater negotiating power.

Threat Of New Entrants

The threat of new entrants is high due to the relatively low barriers to entry in the money transfer market. New fintech companies and digital payment platforms are emerging, posing a threat to Western Union's market share.

Intensity Of Rivalry

The intensity of rivalry is high due to the presence of established competitors such as MoneyGram and PayPal, as well as new entrants in the market. This leads to a highly competitive market with intense price competition and advertising efforts.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 85.70%
Debt Cost 5.01%
Equity Weight 14.30%
Equity Cost 8.19%
WACC 5.46%
Leverage 599.06%

11. Quality Control: The Western Union Company passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Synchrony

A-Score: 6.9/10

Value: 7.9

Growth: 7.8

Quality: 7.6

Yield: 4.0

Momentum: 7.5

Volatility: 6.7

1-Year Total Return ->

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Stock-Card
OneMain Holdings

A-Score: 6.7/10

Value: 5.4

Growth: 5.4

Quality: 5.2

Yield: 10.0

Momentum: 7.5

Volatility: 6.3

1-Year Total Return ->

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Stock-Card
FirstCash

A-Score: 6.5/10

Value: 4.3

Growth: 7.6

Quality: 8.4

Yield: 2.0

Momentum: 8.5

Volatility: 8.0

1-Year Total Return ->

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Stock-Card
SLM

A-Score: 6.2/10

Value: 7.0

Growth: 5.6

Quality: 6.8

Yield: 4.0

Momentum: 7.0

Volatility: 7.0

1-Year Total Return ->

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Stock-Card
Western Union

A-Score: 5.8/10

Value: 7.4

Growth: 3.2

Quality: 6.1

Yield: 10.0

Momentum: 0.5

Volatility: 7.7

1-Year Total Return ->

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Stock-Card
Ally Financial

A-Score: 5.7/10

Value: 7.1

Growth: 5.2

Quality: 3.3

Yield: 6.0

Momentum: 6.0

Volatility: 6.7

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

8.93$

Current Price

8.93$

Potential

-0.00%

Expected Cash-Flows