WEX Inc. (WEX - Free Report) delivered better-than-expected second-quarter 2023 results.
The earnings beat failed to impress the market as there has not been any major price change since the earnings release on Jul 27.
Adjusted earnings of $3.63 per share surpassed the Zacks Consensus Estimate by 3.4% but decreased 2.2% year over year. Total revenues of $621.3 million surpassed the consensus mark by a slight margin and increased 3.9% year over year.
WEX shares have gained 12.4% in the past year, significantly outperforming the 4.6% rally of the industry it belongs to.
Quarter Details
Mobility revenues decreased 10% year over year to $340.2 million, missing our estimate of $371 million. Corporate Payments revenues of $121.9 million were up 21% year over year, which beat our estimate of $171.7 million. Benefits revenues of $159.2 million registered 34% year-over-year growth and surpassed our estimate of $138.6 million.
Total volume across the company came in at $55.3 billion, down 2.3% year over year. The average number of vehicles serviced was around 18.9 million, up 8% from the year-ago quarter’s figure. Mobility payment processing transactions were down 1% year over year to 142.4 million.
Corporate Payments purchase volume surged 34% year over year to $22.9 billion. Benefits average number of Software-as-a-Service accounts were up 11% to 19.5 million year over year.
Adjusted operating income declined 1.1% to $250.6 million from the year-ago quarter’s $253.3 million. The adjusted operating income margin was 40.3%, down 200 basis points year over year.
Balance Sheet
WEX exited the quarter with a cash and cash equivalents balance of $901.4 million compared with $921.7 million witnessed at the end of the prior quarter. Long-term debt was $2.5 billion compared with $2.6 billion at the end of the previous quarter.
Guidance
For the third quarter of 2023, WEX anticipates revenues in the range of $629-$639 million, the midpoint ($634 million) of which is lower than the current Zacks Consensus Estimate of $635.6 million. Adjusted net income is expected between $3.65 and $3.75 per share. The midpoint ($3.7) of the guided range is slightly lower than the Zacks Consensus Estimate of $3.69.
For 2023, revenues are now expected between $2.5 billion and $2.52 billion compared with the previous expectation of $2.45-$2.49 billion. The current Zacks Consensus Estimate stands at $2.5 billion.
Adjusted net income is now expected between $14.15 and $14.35 per share compared with the prior expectation of $13.85 and $14.25 per share. The raised range is above the Zacks Consensus Estimate of $14.09.
Currently, WEX carries a Zacks Rank #2 (Buy).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Earnings Snapshots of Some Service Providers
Omnicom (OMC - Free Report) reported mixed second-quarter 2023 results, wherein the company’s earnings surpassed the Zacks Consensus Estimate but revenues missed the same.
OMC’s earnings of $1.81 per share beat the consensus estimate by 0.6% and increased 7.7% year over year. Total revenues of $3.6 billion lagged the consensus estimate by 0.3% but increased 1.2% year over year.
Equifax (EFX - Free Report) reported mixed second-quarter 2023 results, wherein earnings beat the Zacks Consensus Estimate but revenues missed the same.
EFX’s adjusted earnings came in at $1.71 per share, beating the consensus mark by 2.4% but declining 18.2% from the year-ago figure. Total revenues of $1.32 billion missed the consensus estimate by 0.4% but matched the year-ago figure on a reported basis.
Interpublic’s (IPG - Free Report) second-quarter 2023 earnings surpassed the Zacks Consensus Estimate while revenues missed the same.
IPG’s adjusted earnings came in at 74 cents per share, beating the Zacks Consensus Estimate by 23.3% but declining 17.5% on a year-over-year basis. Net revenues of $2.33 billion missed the consensus estimate by 2.9% and decreased 14.9% on a year-over-year basis. Total revenues of $2.67 billion decreased 2.6% year over year.
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WEX Inc. (WEX - Free Report) delivered better-than-expected second-quarter 2023 results.
The earnings beat failed to impress the market as there has not been any major price change since the earnings release on Jul 27.
Adjusted earnings of $3.63 per share surpassed the Zacks Consensus Estimate by 3.4% but decreased 2.2% year over year. Total revenues of $621.3 million surpassed the consensus mark by a slight margin and increased 3.9% year over year.
WEX shares have gained 12.4% in the past year, significantly outperforming the 4.6% rally of the industry it belongs to.
Quarter Details
Mobility revenues decreased 10% year over year to $340.2 million, missing our estimate of $371 million. Corporate Payments revenues of $121.9 million were up 21% year over year, which beat our estimate of $171.7 million. Benefits revenues of $159.2 million registered 34% year-over-year growth and surpassed our estimate of $138.6 million.
Total volume across the company came in at $55.3 billion, down 2.3% year over year. The average number of vehicles serviced was around 18.9 million, up 8% from the year-ago quarter’s figure. Mobility payment processing transactions were down 1% year over year to 142.4 million.
Corporate Payments purchase volume surged 34% year over year to $22.9 billion. Benefits average number of Software-as-a-Service accounts were up 11% to 19.5 million year over year.
Adjusted operating income declined 1.1% to $250.6 million from the year-ago quarter’s $253.3 million. The adjusted operating income margin was 40.3%, down 200 basis points year over year.
Balance Sheet
WEX exited the quarter with a cash and cash equivalents balance of $901.4 million compared with $921.7 million witnessed at the end of the prior quarter. Long-term debt was $2.5 billion compared with $2.6 billion at the end of the previous quarter.
Guidance
For the third quarter of 2023, WEX anticipates revenues in the range of $629-$639 million, the midpoint ($634 million) of which is lower than the current Zacks Consensus Estimate of $635.6 million. Adjusted net income is expected between $3.65 and $3.75 per share. The midpoint ($3.7) of the guided range is slightly lower than the Zacks Consensus Estimate of $3.69.
For 2023, revenues are now expected between $2.5 billion and $2.52 billion compared with the previous expectation of $2.45-$2.49 billion. The current Zacks Consensus Estimate stands at $2.5 billion.
Adjusted net income is now expected between $14.15 and $14.35 per share compared with the prior expectation of $13.85 and $14.25 per share. The raised range is above the Zacks Consensus Estimate of $14.09.
Currently, WEX carries a Zacks Rank #2 (Buy).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Earnings Snapshots of Some Service Providers
Omnicom (OMC - Free Report) reported mixed second-quarter 2023 results, wherein the company’s earnings surpassed the Zacks Consensus Estimate but revenues missed the same.
OMC’s earnings of $1.81 per share beat the consensus estimate by 0.6% and increased 7.7% year over year. Total revenues of $3.6 billion lagged the consensus estimate by 0.3% but increased 1.2% year over year.
Equifax (EFX - Free Report) reported mixed second-quarter 2023 results, wherein earnings beat the Zacks Consensus Estimate but revenues missed the same.
EFX’s adjusted earnings came in at $1.71 per share, beating the consensus mark by 2.4% but declining 18.2% from the year-ago figure. Total revenues of $1.32 billion missed the consensus estimate by 0.4% but matched the year-ago figure on a reported basis.
Interpublic’s (IPG - Free Report) second-quarter 2023 earnings surpassed the Zacks Consensus Estimate while revenues missed the same.
IPG’s adjusted earnings came in at 74 cents per share, beating the Zacks Consensus Estimate by 23.3% but declining 17.5% on a year-over-year basis. Net revenues of $2.33 billion missed the consensus estimate by 2.9% and decreased 14.9% on a year-over-year basis. Total revenues of $2.67 billion decreased 2.6% year over year.
4 Oil Stocks with Massive Upsides
Global demand for oil is through the roof... and oil producers are struggling to keep up. So even though oil prices are well off their recent highs, you can expect big profits from the companies that supply the world with "black gold."
Zacks Investment Research has just released an urgent special report to help you bank on this trend.
In Oil Market on Fire, you'll discover 4 unexpected oil and gas stocks positioned for big gains in the coming weeks and months. You don't want to miss these recommendations.
Download your free report now to see them.
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