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WEX Gains 11% Despite Missing on Q3 Earnings and Revenues
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WEX Inc. (WEX - Free Report) reported weak third-quarter 2020 results, with earnings and revenues missing the Zacks Consensus Estimate. The stock gained 11% since the earnings release despite the lower-than-expected results.
Adjusted earnings of $1.59 per share missed the Zacks Consensus estimate by 9.1% and declined 39% year over year. Total revenues of $382.1 million surpassed the consensus mark by 2.9% and decreased 17% year over year.
Notably, WEX’s shares have declined 28.7% over the past year against 5.6% growth of the industry it belongs to.
Revenues by Segment
Fleet Solutions revenues (60% of total revenues) decreased 18% year over year to $228.7 million. This downside was due to pandemic-led unfavorable fuel prices and lower volumes.
Average number of vehicles serviced was 15.3 million, up 7% from the year-ago quarter’s figure. Total fuel transactions processed decreased 8% from the year-ago quarter’s tally to 149.6 million. Payment processing transactions were down 11% to 120.9 million. U.S. retail fuel price increased 7.7% to $2.23 per gallon.
Travel and Corporate Solutions revenues (17%) of $64.3 million were down 35% year over year. The decrease can be attributed to decline in revenues from travel-related customers. Purchase volume decreased 59% to $4.7 billion.
Health and Employee Benefit Solutions revenues (23%) of $89.1 million jumped 7%, year over year, on 11% growth in U.S. healthcare business. The average number of Software-as-a-Service (SaaS) accounts in the United States climbed 12% year over year to 14.6 million.
Adjusted operating income decreased 32% from the prior-year quarter’s figure to $125.4 million. Adjusted operating income margin declined to 32.8% from the year-ago quarter’s 40.2%.
Balance Sheet
WEX exited the quarter with cash and cash equivalents of $1.5 billion compared with $1.3 billion witnessed at the end of the prior quarter. Long-term debt was $2.9 billion, compared with $2.7 billion at the end of the previous quarter.
Currently, WEX carries a Zacks Rank #5 (Strong Sell).
Recent Performance of Some Business Services Companies
Equifax Inc. (EFX - Free Report) reported third-quarter 2020 adjusted earnings of $1.87 per share that beat the Zacks Consensus Estimate by 16.2% and improved 26.4% on a year-over-year basis. Revenues of $1.07 billion outpaced the consensus estimate by 5.9% and improved 22% year over year.
ManpowerGroup Inc. (MAN - Free Report) reported third-quarter 2020 earnings of $1.12 per share, beating the consensus mark by 90.5% but declining more than 37.5% year over year. Revenues of $4.58 billion surpassed the consensus mark by 8.7% but declined 12.7% year over year.
IHS Markit Ltd. recorded third-quarter fiscal 2020 adjusted earnings per share of 77 cents that surpassed the consensus estimate by 11.6% and increased 15% on a year-over-year basis. Total revenues came in at $1.07 billion, marginally surpassing the consensus mark but declining 4% from the year-ago quarter.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
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WEX Gains 11% Despite Missing on Q3 Earnings and Revenues
WEX Inc. (WEX - Free Report) reported weak third-quarter 2020 results, with earnings and revenues missing the Zacks Consensus Estimate. The stock gained 11% since the earnings release despite the lower-than-expected results.
Adjusted earnings of $1.59 per share missed the Zacks Consensus estimate by 9.1% and declined 39% year over year. Total revenues of $382.1 million surpassed the consensus mark by 2.9% and decreased 17% year over year.
Notably, WEX’s shares have declined 28.7% over the past year against 5.6% growth of the industry it belongs to.
Revenues by Segment
Fleet Solutions revenues (60% of total revenues) decreased 18% year over year to $228.7 million. This downside was due to pandemic-led unfavorable fuel prices and lower volumes.
Average number of vehicles serviced was 15.3 million, up 7% from the year-ago quarter’s figure. Total fuel transactions processed decreased 8% from the year-ago quarter’s tally to 149.6 million. Payment processing transactions were down 11% to 120.9 million. U.S. retail fuel price increased 7.7% to $2.23 per gallon.
Travel and Corporate Solutions revenues (17%) of $64.3 million were down 35% year over year. The decrease can be attributed to decline in revenues from travel-related customers. Purchase volume decreased 59% to $4.7 billion.
Health and Employee Benefit Solutions revenues (23%) of $89.1 million jumped 7%, year over year, on 11% growth in U.S. healthcare business. The average number of Software-as-a-Service (SaaS) accounts in the United States climbed 12% year over year to 14.6 million.
WEX Inc. Price, Consensus and EPS Surprise
WEX Inc. price-consensus-eps-surprise-chart | WEX Inc. Quote
Operating Results
Adjusted operating income decreased 32% from the prior-year quarter’s figure to $125.4 million. Adjusted operating income margin declined to 32.8% from the year-ago quarter’s 40.2%.
Balance Sheet
WEX exited the quarter with cash and cash equivalents of $1.5 billion compared with $1.3 billion witnessed at the end of the prior quarter. Long-term debt was $2.9 billion, compared with $2.7 billion at the end of the previous quarter.
Currently, WEX carries a Zacks Rank #5 (Strong Sell).
You can see the complete list of today’s Zacks #1 Rank stocks here.
Recent Performance of Some Business Services Companies
Equifax Inc. (EFX - Free Report) reported third-quarter 2020 adjusted earnings of $1.87 per share that beat the Zacks Consensus Estimate by 16.2% and improved 26.4% on a year-over-year basis. Revenues of $1.07 billion outpaced the consensus estimate by 5.9% and improved 22% year over year.
ManpowerGroup Inc. (MAN - Free Report) reported third-quarter 2020 earnings of $1.12 per share, beating the consensus mark by 90.5% but declining more than 37.5% year over year. Revenues of $4.58 billion surpassed the consensus mark by 8.7% but declined 12.7% year over year.
IHS Markit Ltd. recorded third-quarter fiscal 2020 adjusted earnings per share of 77 cents that surpassed the consensus estimate by 11.6% and increased 15% on a year-over-year basis. Total revenues came in at $1.07 billion, marginally surpassing the consensus mark but declining 4% from the year-ago quarter.
These Stocks Are Poised to Soar Past the Pandemic
The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.
Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.
See the 5 high-tech stocks now>>