Yahoo Finance Western Union (WU) Restarts Limited Remittances to Cuba
The Western Union Company WU resumed its money remittance services to Cuba, following a two-year halt. The pilot program has started with limited capacity and the company is expected to expand operations in the future.
WU stopped remittance services to Cuba in 2020, following government sanctions, some of which have been eased by the current administration. The pilot phase is rolled out in three locations in Miami. Money can be sent to three Cuban state-run banks in this phase. Payments restrictions currently include a $2,000-per-day limit, only dollar transfers are allowed and online mode is unavailable.
Tight U.S. sanctions hit Cuba’s economy hard. As such, the latest move from Western Union is expected to be beneficial for its economy, which is still recovering from the pandemic and finding it hard to rely on its struggling tourism industry. The resumption of services will also likely reduce dependency on informal money-changing services.
Western Union is a significant stakeholder in the global remittance market, with operations in more than 200 countries and territories. Strengthening its remittance-led offerings is in line with the company’s long-term growth plan.
The global remittance market was affected by the pandemic-driven uncertainties and roadblocks. The industry is bouncing back at a significant speed. Western Union is expected to gain heavily from this ongoing recovery. However, its declining profits, cash flows and high leverage are concerning for investors.
Price Performance
Western Union’s shares have declined 20.5% in the past year compared with a 9% fall in the industry it belongs to.
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Zacks Rank & Stocks to Consider
Western Union currently has a Zacks Rank #4 (Sell).
Some better-ranked stocks in the broader Business Services space are EVERTEC, Inc. EVTC, Envestnet, Inc. ENV and Cantaloupe, Inc. CTLP, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Headquartered in San Juan, Puerto Rico, EVERTEC has a leading transaction processing business in the Caribbean and Latin America. The Zacks Consensus Estimate for EVTC’s 2022 bottom line is pegged at $2.41 per share. The consensus mark for 2022 revenues is pegged at $611.1 million, indicating 3.6% year-over-year growth.
Based in Berwyn, PA, Envestnet offers wealth management software and services. The Zacks Consensus Estimate for ENV’s 2022 earnings is pegged at $1.85 per share. It beat earnings estimates in the past four quarters, with an average of 5%.
Malvern, PA-based Cantaloupe works as a digital payments and software services firm. The Zacks Consensus Estimate for CTLP’s 2022 bottom line indicates a 66.7% year-over-year improvement. It witnessed one upward estimate revision in the past 30 days against none in the opposite direction.
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The Western Union Company (WU) : Free Stock Analysis Report
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