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Here's Why You Should Hold WEX Stock in Your Portfolio For Now

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WEX Inc.’s (WEX - Free Report) stock has gained 25.2% in the past six months against 19% decline of the industry it belongs to.

The company has an expected long-term (three to five years) earnings per share growth rate of 17.4%. Its earnings for 2022 and 2023 are expected to grow 38.7% and 8.3% year over year, respectively.

Factors That Auger Well

WEX’s strategic revenue generation efforts include utilizing its extensive network of fuel and service providers, transaction volume growth, product excellence, marketing capabilities, and sales force productivity.

WEX has been actively acquiring and investing in companies, both in the United States and internationally, to expand its product and service offerings, thereby boosting its revenue growth and enhancing scalability.

The June 2021 acquisition of benefitexpress has expanded WEX’s offerings in benefits administration by bringing in a complementary suite of solutions to its Health offerings. In 2020, WEX acquired eNett and Optal, both of which have strengthened the company’s position in the global travel marketplace.

Some Risks

WEX's current ratio at the end of first-quarter 2022 was pegged at 1.21, lower than the current ratio of 1.28 reported at the end of the previous quarter. Decreasing current ratio is not desirable as it indicates that the company may have problems meeting its short-term debt obligations.

Zacks Rank and Stocks to Consider

WEX currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some better-ranked stocks in the broader Zacks Business Services sector are Avis Budget Group (CAR - Free Report) ,Cross Country Healthcare (CCRN - Free Report) and CRA International (CRAI - Free Report) .

Avis Budget sports a Zacks Rank #1 at present. CAR has a long-term earnings growth expectation of 19.4%. 

Avis Budget delivered a trailing four-quarter earnings surprise of 102%, on average. 

Cross Country Healthcare sports a Zacks Rank of 1 at present. CCRN has a long-term earnings growth expectation of 6.9%.

Cross Country Healthcare delivered a trailing four-quarter earnings surprise of 29.2%, on average. 

CRA International carries a Zacks Rank #2 (Buy), currently. CRAI has a long-term earnings growth expectation of 14.3%.

CRAI delivered a trailing four-quarter earnings surprise of 35.8%, on average.

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