Charles Heenan, investment director of Kennox and co-manager of Kennox Strategic Value Fund (GB00B9B3CY80), likes international money transfer service, Western Union (US: WU). He says the company remains undervalued and is now set to benefit from an upward trend in cross-border remittance payments.
"Office for National Statistics (ONS) data shows an increase in global population movements matched by a growing migrant workforce year on year," he says. "As the world's leading money transfer provider, Western Union should be a beneficiary of remittances from migrants sending money back home to families."
In recent years, increased regulation and clampdowns on money laundering by governments have eaten into profit margins, but this disproportionately affects smaller players and new market entrants, causing a competitive advantage for the bigger established operators.