WU Stock Offering Great Opportunity to Income Investors?
Sometimes it’s important for investors to look beyond the headlines and what’s hot on the stock market.
In fact, the best opportunities are almost never in the headlines. But when they are, it’s likely investors are already late to the party.
Now, it might be easier said than done, but when looking for contrarian opportunities, investors should ask if the company in question is doing something that could change its current trajectory. Not everything that’s down is good.
Take Western Union Co (NYSE:WU), for example.
If you talk publicly about Western Union, it’s likely you’ll get laughed at. Why? Because the company is considered “old school.” With cryptocurrencies gaining popularity and attracting massive capital inflows, many question the survival of Western Union.
But before income investors dismiss it, know this: there’s still value here. WU stock is trading as if the company were facing massive problems and weren’t profitable. Shares have dropped close to 30% over the past year, now down about 21% year to date.
The reality, however, is very different.
What Does Western Union Do?
Headquartered in Denver, Colorado, Western Union Co offers money movement and payment services globally. The company operates through two business segments:
- Consumer Money Transfer: Provides international cross-border and intra-country money transfer services through a network of retail agent locations, websites, and mobile devices.
- Consumer Services: Offers bill payments, money orders, retail foreign exchange, prepaid cards, lending partnerships, digital wallets, and a media network. (Source: “Profile,” Yahoo! Finance, last accessed September 15, 2025.)
WU Stock Is Down, But Not Out
Here’s the thing: WU stock has been caught in the debate about what cryptocurrencies will do to the money transfer and financial services sectors. Investors are asking if Western Union will survive. And that’s a fair question.
However, Western Union continues to make money. Cryptocurrencies are still in their infancy, and there’s no telling which one will ultimately dominate.
Just so you know: as of September 2025, more than 37 million unique cryptocurrencies have been created, and the crypto world is on track to reach 100 million cryptocurrencies by year-end. (Source: “How Many Cryptocurrencies Exist on September 2025?,” Tangem, September 5, 2025.)
Western Union still has a strong business and a global reach. For 2025 and 2026, it’s on track to post revenue of over $4.0 billion and $4.12 billion, respectively, according to Wall Street analysts.
As for profitability, the company is projected to report earnings per share (EPS) of $1.71 in 2025 and $1.77 in 2026. (Source: “Analysis,” Yahoo! Finance, last accessed September 15, 2025.)
This alone should tell you that the selling may have gone too far.
Western Union Is Fighting Back
Furthermore, Western Union isn’t a company waiting for its last day. It’s fighting back.
On August 10, 2025, the company announced a definitive agreement to acquire International Money Express Inc (NASDAQ:IMXI) in an all-cash transaction at $16.00 per share, for a total equity and enterprise value of approximately $500.0 million. (Source: “Western Union to Acquire International Money Express, Inc.,” Western Union Co, August 10, 2025.)
This acquisition could give Western Union a bigger edge in the U.S. market and improve its overall financial position.
WU Stock Still Pays a Strong Dividend
Investors holding WU are still being rewarded, too. It can’t be stressed enough: no way is this stock a lost cause.
At the current price, WU has a dividend yield of 11.19%, paying $0.94 per share annually.
Are these dividends safe?
Assuming the company’s earnings come in as expected by Wall Street analysts, the dividend is easily covered. In fact, Western Union could even increase its payout slightly and still have it covered.
Chart Courtesy of StockCharts.com
The Lowdown on Western Union
Currently, WU is being ignored by investors, but there’s a great opportunity here for income investors. There is a robust dividend and potential for significant upside.
Wall Street analysts have a one-year price target for the stock of $9.32, with some high targets at $17.00.
On top of that, WU is heavily owned by institutional investors. According to the most recent data, over 95% of all outstanding shares are owned by institutions. The Vanguard Group Inc., BlackRock Inc., and State Street Corp are three of the biggest institutional holders, collectively owning more than 80 million shares. (Source: “Holders,” Yahoo! Finance, last accessed September 15, 2025.)
Bottom line: Western Union may not be a headline grabber, but its fundamentals and dividend yield make it a compelling contrarian play for income-focused investors.