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WEX's Q2 Earnings and Revenues Beat Estimates, Increase Y/Y

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WEX Inc. (WEX - Free Report) delivered better-than-expected second-quarter 2021 results.

Adjusted earnings of $2.31 per share surpassed the Zacks Consensus Estimate by 16.1 and increased 91% year over year. Total revenues of $459.5 million surpassed the consensus mark by 5.1% and increased 32% year over year.

Notably, WEX’s shares have rallied 22.9% in the past year compared with 6.4% growth of the industry it belongs to.

Revenues by Segment

Fleet Solutions revenues were up 34% year over year to $274.4 million. Travel and Corporate Solutions revenues of $81.8 million were up 50% year over year. Health and Employee Benefit Solutions revenues of $103.3 million increased 17% year over year.

Key Performance Metrics

Average number of vehicles serviced was 16.2 million, up 7% from the year-ago quarter’s figure. Total fuel transactions processed increased 24% from the year-ago quarter’s tally to 158.7 million. Payment processing transactions were up 26% year over year to 130.1 million. Travel and Corporate Solutions' purchase volume climbed more than 100% year over year to $8.7 billion. Health and Employee Benefit Solutions' average number of Software-as-a-Service accounts in the United States were up 13% to 16.4 million, year over year.

Operating Results

Adjusted operating income was up 67.9% from the prior-year quarter’s figure to $166.9 million. Adjusted operating income margin increased to 36.3% from the year-ago quarter’s level 28.7%.

Balance Sheet

WEX exited the quarter with cash and cash equivalents balance of $425.3 million compared with $561.2 million witnessed at the end of the prior quarter. Long-term debt was $2.9 billion compared with $2.5 billion at the end of the previous quarter.

Guidance

For the third quarter of 2021, WEX anticipates revenues in the range of $465 million to $480 million, the midpoint ($472.5 million) of which is higher than the current Zacks Consensus Estimate of $467.82 million. Adjusted net income is expected between $2.15 and $2.35 per share, the midpoint ($2.25 per share) of which is higher than the Zacks Consensus estimate of $2.23.

For full-year 2021, revenues are expected between $1.805 billion to $1.835 billion, higher than the current Zacks Consensus Estimate of $1.8 billion. Adjusted net income is expected between $8.3 and $8.7 per share, the midpoint ($8.5 per share) of which is higher than the Zacks Consensus estimate of $8.39.

Currently, WEX carries a Zacks Rank #3 (Hold).

You can see the complete list of today’s Zacks #1(Strong Buy) Rank stocks here.

Performance of Some Other Business Services Companies

Equifax (EFX - Free Report) reported better-than-expected second-quarter 2021 results. Adjusted earnings of $1.98 per share beat the Zacks Consensus Estimate by 15.8% and improved 23.8% on a year-over-year basis. Revenues of $1.23 billion outpaced the consensus estimate by 6.4% and improved 25.6% year over year.

IHS Markit’s (INFO - Free Report) second-quarter fiscal 2021 adjusted earnings per share of 81 cents beat the consensus mark by 1.3% and increased 17.4% on a year-over-year basis. Total revenues came in at $1.2 billion, surpassing the consensus mark by 3.8% and increasing 15% from the year-ago quarter.

Omnicom (OMC - Free Report) reported second-quarter 2021 adjusted earnings of $1.46 per share that beat the consensus mark by 9.8% and increased 58.7% year over year. Total revenues of $3.6 billion surpassed the consensus estimate by 6.7% and increased 27.5% year over year.


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