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Why Is Wex (WEX) Down 3.6% Since Last Earnings Report?
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It has been about a month since the last earnings report for Wex (WEX - Free Report) . Shares have lost about 3.6% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Wex due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
WEX Q1 Earnings Beat Estimates
WEX Inc. delivered first-quarter fiscal 2026 adjusted earnings of $4.15 per diluted share, up 18.2% year over year and 3.8% above the Zacks Consensus Estimate of $4.00. Revenues totaled $673.8 million, a 5.8% increase from the year-ago quarter and 0.9% ahead of the consensus estimate of $667.7 million.
Benefits stood out with faster growth, while total volume across all segments rose 7.5% to $58.1 billion.
WEX Segment Mix Shows Broad-Based Growth
Revenue growth in the first quarter was supported by contributions from all three operating segments. Mobility remained the largest unit, generating $344.6 million of revenues, up 3.2% from the prior-year period. Benefits revenues climbed 8.5% to $216.2 million, while Corporate Payments revenues advanced 9.3% to $113.0 million.
Operationally, WEX posted solid scale metrics across the portfolio. In Benefits, average Software-as-a-Service accounts increased 3.8% to 22.4 million, and average HSA custodial cash assets rose 11.8% to $5.2 billion. Corporate Payments delivered purchase volume of $17.9 billion, up 3.6%, and total volume processed of $34.2 billion, up 10.1%.
WEX Inc. Mobility Execution Offsets Market Noise
Mobility results reflected improved execution amid volatile fuel dynamics. Payment processing transactions decreased 3.0% to 130.4 million, but revenues still grew, supported by business actions and macro effects that were mixed across geographies.
WEX highlighted that higher U.S. fuel prices were a tailwind, but international fuel spreads were a headwind during the quarter. Within Mobility, the net interchange rate was 1.23%, down 10 basis points sequentially, which management attributed primarily to European market movements along with higher U.S. fuel prices.
WEX Profitability Reflects Credit Losses and AI Focus
On the bottom line, first-quarter fiscal 2026 GAAP net income was $2.22 per diluted share, up 22.7% from the prior-year period. Adjusted operating income margin was 36.2%, down from 36.7% a year ago, while GAAP operating income margin was 23.5% versus 24.7% in the year-ago quarter.
Management tied margin pressure primarily to higher credit losses, while underscoring internal productivity initiatives. On the earnings call, WEX discussed plans to deliver $50 million in cost-saving actions in 2026, including savings from automation and modernization, with part of the savings reinvested and the remainder expected to support margin performance.
WEX Raises 2026 Outlook on Fuel Price Assumptions
Guidance moved higher following the strong start to the year. For the second quarter of fiscal 2026, WEX expects revenues of $727 million to $747 million and adjusted earnings of $4.93 to $5.13 per diluted share.
For full-year 2026, the company raised its outlook to revenues of $2.82 billion to $2.88 billion and adjusted earnings of $18.95 to $19.55 per diluted share. The updated guidance assumes average U.S. retail fuel prices of $4.30 per gallon in the second quarter and $3.70 for the full year, with management noting the guidance does not include potential future impacts from European fuel spreads.
WEX Cash Flow and Leverage Stay in Focus
The balance sheet remained a key investor focus area in the quarter. WEX ended March 31, 2026, with cash and cash equivalents of $633.5 million compared with $905.8 million at Dec. 31, 2025. Long-term debt, net, increased to $3.61 billion from $3.53 billion over the same period, and the leverage ratio, as defined in its Credit Agreement, stood at 3.1x at quarter end.
Cash flow was seasonally pressured. Net cash used for operating activities totaled $330.8 million in the first quarter versus $481.6 million in the year-ago period. Adjusted free cash flow improved to $49.5 million from $16.2 million a year earlier, while capital expenditures were $37.5 million.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a upward trend in estimates review.
The consensus estimate has shifted 10.43% due to these changes.
VGM Scores
At this time, Wex has a subpar Growth Score of D, however its Momentum Score is doing a bit better with a C. However, the stock has a grade of A on the value side, putting it in the top 20% for value investors.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Interestingly, Wex has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Why Is Wex (WEX) Down 3.6% Since Last Earnings Report?
It has been about a month since the last earnings report for Wex (WEX - Free Report) . Shares have lost about 3.6% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Wex due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
WEX Q1 Earnings Beat Estimates
WEX Inc. delivered first-quarter fiscal 2026 adjusted earnings of $4.15 per diluted share, up 18.2% year over year and 3.8% above the Zacks Consensus Estimate of $4.00. Revenues totaled $673.8 million, a 5.8% increase from the year-ago quarter and 0.9% ahead of the consensus estimate of $667.7 million.
Benefits stood out with faster growth, while total volume across all segments rose 7.5% to $58.1 billion.
WEX Segment Mix Shows Broad-Based Growth
Revenue growth in the first quarter was supported by contributions from all three operating segments. Mobility remained the largest unit, generating $344.6 million of revenues, up 3.2% from the prior-year period. Benefits revenues climbed 8.5% to $216.2 million, while Corporate Payments revenues advanced 9.3% to $113.0 million.
Operationally, WEX posted solid scale metrics across the portfolio. In Benefits, average Software-as-a-Service accounts increased 3.8% to 22.4 million, and average HSA custodial cash assets rose 11.8% to $5.2 billion. Corporate Payments delivered purchase volume of $17.9 billion, up 3.6%, and total volume processed of $34.2 billion, up 10.1%.
WEX Inc. Mobility Execution Offsets Market Noise
Mobility results reflected improved execution amid volatile fuel dynamics. Payment processing transactions decreased 3.0% to 130.4 million, but revenues still grew, supported by business actions and macro effects that were mixed across geographies.
WEX highlighted that higher U.S. fuel prices were a tailwind, but international fuel spreads were a headwind during the quarter. Within Mobility, the net interchange rate was 1.23%, down 10 basis points sequentially, which management attributed primarily to European market movements along with higher U.S. fuel prices.
WEX Profitability Reflects Credit Losses and AI Focus
On the bottom line, first-quarter fiscal 2026 GAAP net income was $2.22 per diluted share, up 22.7% from the prior-year period. Adjusted operating income margin was 36.2%, down from 36.7% a year ago, while GAAP operating income margin was 23.5% versus 24.7% in the year-ago quarter.
Management tied margin pressure primarily to higher credit losses, while underscoring internal productivity initiatives. On the earnings call, WEX discussed plans to deliver $50 million in cost-saving actions in 2026, including savings from automation and modernization, with part of the savings reinvested and the remainder expected to support margin performance.
WEX Raises 2026 Outlook on Fuel Price Assumptions
Guidance moved higher following the strong start to the year. For the second quarter of fiscal 2026, WEX expects revenues of $727 million to $747 million and adjusted earnings of $4.93 to $5.13 per diluted share.
For full-year 2026, the company raised its outlook to revenues of $2.82 billion to $2.88 billion and adjusted earnings of $18.95 to $19.55 per diluted share. The updated guidance assumes average U.S. retail fuel prices of $4.30 per gallon in the second quarter and $3.70 for the full year, with management noting the guidance does not include potential future impacts from European fuel spreads.
WEX Cash Flow and Leverage Stay in Focus
The balance sheet remained a key investor focus area in the quarter. WEX ended March 31, 2026, with cash and cash equivalents of $633.5 million compared with $905.8 million at Dec. 31, 2025. Long-term debt, net, increased to $3.61 billion from $3.53 billion over the same period, and the leverage ratio, as defined in its Credit Agreement, stood at 3.1x at quarter end.
Cash flow was seasonally pressured. Net cash used for operating activities totaled $330.8 million in the first quarter versus $481.6 million in the year-ago period. Adjusted free cash flow improved to $49.5 million from $16.2 million a year earlier, while capital expenditures were $37.5 million.
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a upward trend in estimates review.
The consensus estimate has shifted 10.43% due to these changes.
VGM Scores
At this time, Wex has a subpar Growth Score of D, however its Momentum Score is doing a bit better with a C. However, the stock has a grade of A on the value side, putting it in the top 20% for value investors.
Overall, the stock has an aggregate VGM Score of B. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Interestingly, Wex has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.