NYSE:WEX

Stock Analysis Report

Executive Summary

WEX Inc. provides corporate card payment solutions in North and South America, the Asia Pacific, and Europe.


Snowflake Analysis

High growth potential and fair value.


Similar Companies

Share Price & News

How has WEX's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: WEX's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

28.2%

WEX

13.5%

US IT

10.5%

US Market


1 Year Return

-43.3%

WEX

-3.5%

US IT

-11.5%

US Market

Return vs Industry: WEX underperformed the US IT industry which returned -3.5% over the past year.

Return vs Market: WEX underperformed the US Market which returned -11.5% over the past year.


Shareholder returns

WEXIndustryMarket
7 Day28.2%13.5%10.5%
30 Day-42.2%-14.5%-15.4%
90 Day-48.1%-17.4%-21.4%
1 Year-43.3%-43.3%-2.5%-3.5%-9.6%-11.5%
3 Year5.1%5.1%59.2%52.4%12.6%5.4%
5 Year2.2%2.2%89.2%72.7%32.8%18.1%

Price Volatility Vs. Market

How volatile is WEX's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is WEX undervalued compared to its fair value and its price relative to the market?

45.5%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: WEX ($108.78) is trading below our estimate of fair value ($199.44)

Significantly Below Fair Value: WEX is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: WEX is poor value based on its PE Ratio (47.6x) compared to the IT industry average (24.8x).

PE vs Market: WEX is poor value based on its PE Ratio (47.6x) compared to the US market (13x).


Price to Earnings Growth Ratio

PEG Ratio: WEX is poor value based on its PEG Ratio (1.3x)


Price to Book Ratio

PB vs Industry: WEX is good value based on its PB Ratio (2.4x) compared to the US IT industry average (2.7x).


Next Steps

Future Growth

How is WEX forecast to perform in the next 1 to 3 years based on estimates from 17 analysts?

37.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: WEX's forecast earnings growth (37.6% per year) is above the savings rate (1.7%).

Earnings vs Market: WEX's earnings (37.6% per year) are forecast to grow faster than the US market (12.3% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: WEX's revenue (7.9% per year) is forecast to grow faster than the US market (7.3% per year).

High Growth Revenue: WEX's revenue (7.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: WEX's Return on Equity is forecast to be high in 3 years time (30.1%)


Next Steps

Past Performance

How has WEX performed over the past 5 years?

-2.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: WEX has high quality earnings.

Growing Profit Margin: WEX's current net profit margins (5.7%) are lower than last year (11.3%).


Past Earnings Growth Analysis

Earnings Trend: WEX's earnings have declined by -2.2% per year over the past 5 years.

Accelerating Growth: WEX's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: WEX had negative earnings growth (-41.2%) over the past year, making it difficult to compare to the IT industry average (14.3%).


Return on Equity

High ROE: WEX's Return on Equity (7.4%) is considered low.


Next Steps

Financial Health

How is WEX's financial position?


Financial Position Analysis

Short Term Liabilities: WEX's short term assets ($3.8B) exceed its short term liabilities ($3.0B).

Long Term Liabilities: WEX's short term assets ($3.8B) exceed its long term liabilities ($3.2B).


Debt to Equity History and Analysis

Debt Level: WEX's debt to equity ratio (141.2%) is considered high.

Reducing Debt: WEX's debt to equity ratio has increased from 123.7% to 141.2% over the past 5 years.

Debt Coverage: WEX's debt is well covered by operating cash flow (22.4%).

Interest Coverage: WEX's interest payments on its debt are not well covered by EBIT (2.4x coverage).


Balance Sheet

Inventory Level: WEX has a low level of unsold assets or inventory.

Debt Coverage by Assets: WEX's debt is covered by short term assets (assets are 1.3x debt).


Next Steps

Dividend

What is WEX's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate WEX's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate WEX's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if WEX's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if WEX's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of WEX's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.7yrs

Average management tenure


CEO

Melissa Smith (50yo)

6.17s

Tenure

US$5,630,717

Compensation

Ms. Melissa D. Smith serves as Chairman of the Board from September 12, 2019. She has been the Chief Executive Officer of WEX Inc. (alternatively Wright Express Corp) since January 1, 2014 and has been its ...


CEO Compensation Analysis

Compensation vs Market: Melissa's total compensation ($USD5.63M) is about average for companies of similar size in the US market ($USD7.47M).

Compensation vs Earnings: Melissa's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Melissa Smith
Chairman of the Board6.17yrsUS$5.63m0.20% $10.0m
Roberto Simon
Chief Financial Officer4.08yrsUS$2.23m0.047% $2.4m
Melanie Tinto
Chief Human Resources Officer2.17yrsUS$2.08m0.011% $570.5k
Scott Phillips
President of Global Fleet3.67yrsUS$2.12m0.043% $2.2m
Kenneth Janosick
Chief Portfolio Risk & Operations Officer2.25yrsUS$3.75m0.048% $2.4m
David Cooper
Chief Technology Officer3.25yrsno data0.012% $600.3k
Steven Elder
Senior Vice President of Global Investor Relationsno dataUS$650.34kno data
Hilary Rapkin
Chief Legal Officer21.92yrsUS$855.48k0.037% $1.9m
Nicola Morris
Chief Corporate Development Officer6.08yrsUS$1.71m0.034% $1.7m
Joel Dearborn
President of Corporate Payments2.25yrsno data0.012% $627.0k

3.7yrs

Average Tenure

50yo

Average Age

Experienced Management: WEX's management team is considered experienced (3.7 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Melissa Smith
Chairman of the Board6.17yrsUS$5.63m0.20% $10.0m
James Neary
Independent Director3.67yrsUS$228.83k0.0054% $274.9k
Jack VanWoerkom
Vice Chair & Lead Independent Director0.50yrUS$232.45kno data
Rowland Moriarty
Independent Director15.08yrsUS$259.95k0.083% $4.2m
Shikhar Ghosh
Independent Director15.17yrsUS$234.95k0.0086% $431.8k
Regina Sommer
Independent Director15.17yrsUS$244.95k0.015% $731.4k
Michael Dubyak
Director15.17yrsUS$324.88k0.074% $3.7m
Susan Sobbott
Independent Director1.25yrsUS$7.92kno data
John Bachman
Independent Director3.5yrsUS$227.45k0.0054% $274.9k
Daniel Callahan
Independent Director0.83yrno datano data

3.6yrs

Average Tenure

62yo

Average Age

Experienced Board: WEX's board of directors are considered experienced (3.6 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: WEX insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

WEX Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: WEX Inc.
  • Ticker: WEX
  • Exchange: NYSE
  • Founded: 1983
  • Industry: Data Processing and Outsourced Services
  • Sector: Software
  • Market Cap: US$5.044b
  • Shares outstanding: 43.34m
  • Website: https://www.wexinc.com

Number of Employees


Location

  • WEX Inc.
  • 1 Hancock Street
  • Portland
  • Maine
  • 4101
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
WEXNYSE (New York Stock Exchange)YesCommon StockUSUSDFeb 2005
WL9DB (Deutsche Boerse AG)YesCommon StockDEEURFeb 2005

Biography

WEX Inc. provides corporate card payment solutions in North and South America, the Asia Pacific, and Europe. It operates through three segments: Fleet Solutions, Travel and Corporate Solutions, and Health and Employee Benefit Solutions. The Fleet Solutions segment offers fleet vehicle payment processing services. Its services include customer, account activation, and account retention services; authorization and billing inquiries, and account maintenance services; premium fleet services; credit and collections services; and merchant services, as well as offers ClearView analytics platform, a Web-based data analytics platform that offers insights to fleet managers and SmartHub mobile application for business managers to access their account information. This segment markets its products directly to commercial and government vehicle fleet customers with small, medium, and large fleets, as well as with over-the-road and long haul fleets; and indirectly through co-branded and private label relationships. The Travel and Corporate Solutions segment provides payment processing solutions for corporate payment and transaction monitoring needs. Its products include virtual cards that are used for transactions where no card is presented and that require pre-authorization; and prepaid and gift card products that enables secure payment and financial management solutions with single card options, access to open or closed loop redemption, load limits, and with various expirations. This segment markets its products directly to commercial and government organizations. The Health and Employee Benefit Solutions segment offers healthcare payment products and software-as-a-service consumer directed platforms for healthcare market, as well as payroll related and employee benefit products in Brazil. The company was formerly known as Wright Express Corporation and changed its name to WEX Inc. in October 2012. WEX Inc. was founded in 1983 and is headquartered in Portland, Maine. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/28 02:15
End of Day Share Price2020/03/27 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.