WEX's Q3 Earnings and Revenues Surpass Estimates, Increase Y/Y

WEX Inc. WEX delivered better-than-expected third-quarter 2021 results.

Adjusted earnings of $2.45 per share surpassed the Zacks Consensus Estimate by 7% and increased more than 54% year over year. Total revenues of $482.8 million surpassed the consensus mark by 1% and increased 26% year over year.

WEX’s shares have rallied 46.1% in the past year against 1.9% decline of the industry it belongs to.

WEX Inc. Price, Consensus and EPS Surprise

WEX Inc. Price, Consensus and EPS Surprise

WEX Inc. price-consensus-eps-surprise-chart | WEX Inc. Quote

Revenues by Segment

Fleet Solutions revenues were up 25% year over year to $286.4 million. Travel and Corporate Solutions revenues of $91 million were up 42% year over year. Health and Employee Benefit Solutions revenues of $105.4 million increased 18% year over year.

Key Performance Metrics

Average number of vehicles serviced was 16.2 million, up 6% from the year-ago quarter’s figure. Total fuel transactions processed increased 8% from the year-ago quarter’s tally to 161.8 million. Payment processing transactions were up 11% year over year to 134 million. Travel and Corporate Solutions' purchase volume climbed more than 100% year over year to $12.8 billion. Health and Employee Benefit Solutions' average number of Software-as-a-Service accounts in the U.S. were up 16% to 16.9 million, year over year.

Operating Results

Adjusted operating income came in at $178.8 million compared with the prior-year quarter’s figure of $125.4 million. Adjusted operating income margin increased to 37% from the year-ago quarter’s level of 32.8%.

Balance Sheet

WEX exited the quarter with cash and cash equivalents balance of $533.8 million compared with $425.3 million witnessed at the end of the prior quarter. Long-term debt was $2.8 billion compared with $2.9 billion at the end of the previous quarter.

Guidance

For the fourth quarter of 2021, WEX anticipates revenues in the range of $468 million to $483 million, the midpoint ($475.5 million) of which is lower than the current Zacks Consensus Estimate of $477.91 million. Adjusted net income is expected between $2.25 and $2.45 per share, the midpoint ($2.35 per share) of which is higher than the Zacks Consensus estimate of $2.28.

For full-year 2021, revenues are expected between $1.821 billion to $1.836 billion, the midpoint ($1.83 million) of which is the same as the current Zacks Consensus Estimate. Adjusted net income is expected between $8.81 and $9.01 per share, higher than the Zacks Consensus estimate of $8.66.

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

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

Recent Performance of Some Other Business Services Companies

Equifax EFX reported better-than-expected third-quarter 2021 results. Adjusted earnings of $1.85 per share beat the Zacks Consensus Estimate by 7.6% but declined 1.1% on a year-over-year basis. Revenues of $1.22 billion outpaced the consensus estimate by 3.6% and improved 14.5% year over year.

IQVIA Holdings IQV reported impressive third-quarter 2021 results, with earnings per share of $2.17 beating the consensus mark by 1.9% and improving 33.1% on a year-over-year basis. Total revenues of $3.39 billion outpaced the consensus estimate by 1% and increased 21.7% year over year.

Omnicom OMC reported third-quarter 2021 adjusted earnings of $1.65 per share that beat the consensus mark by 20.4% and increased 36.4% year over year. Total revenues of $3.4 billion surpassed the consensus estimate by 0.6% and increased 7.1% year over year.

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