Western Union Co. (WU - Free Report) , a leader in cross-border, cross-currency money movement, has tied up with Paramount Commerce, a Canada-based payments technology company to enable online account-funded money transfers.
The deal will allow consumers in Canada to send money from westernunion.com or the Western Union mobile app—funded from their bank accounts—directly into bank accounts in over 100 countries and territories around the world.
Money transfer can also be made in local currency at several Western Union Agent locations globally.
Western Union is rapidly expanding in Canada. Last month, the company collaborated with Canadian financial institution, TD, to offer fast and convenient way for TD account-holders to send money around the world.
Canada is an attractive remittance market. According to World Bank data, consumers in Canada sent more than $24.6 billion abroad in 2017. China, India, the Philippines, France and Italy make up nearly half of the receive remittances. These markets total an estimated 1.6 billion adults with bank accounts, or 42% of global bank adults.
Recently, another money transfer company, MoneyGram International, Inc. (MGI - Free Report) teamed up with Canada Post, for digital money transfer service that allows users to complete transactions at select Canada Post locations all over the country.
To expand its agent network and reach, Western Union has been making several tie ups and partnership with banks, retailers and post office across the globe. These tie ups and partnerships are in line with the company's efforts to grow its market share amid rising competition from many fintech companies such as PayPal Holdings, Inc. (PYPL - Free Report) , Square Inc (SQ - Free Report) and others, that have entered the payments space in recent years and are fast eating into the market share by dint of their low cost and efficient services.
Western Union has also streamlined its business operations by recent sale of three of its businesses– Speedpay, U.S. domestic bill pay business; Walletron, a provider of mobile bill presentment solutions and Paymap mortgage payments services.
Part of the funds generated from the above businesses will be used for sharebuyback and debt payoff, which will aid the company’s bottom line and reduce its leverage.
The company's revenues have been under pressure. High compliance costs and foreign exchange volatility have further weighed on its profitability.
Year to date, its stock is up 39% compared with the industry 's growth of 38%.
Western Union carries a Zacks Rank #3 (Hold).
You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here .
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