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It's been a sad week for WEX Inc. (NYSE:WEX), who've watched their investment drop 17% to US$152 in the week since the company reported its yearly result. It looks like the results were a bit of a negative overall. While revenues of US$2.6b were in line with analyst predictions, statutory earnings were less than expected, missing estimates by 4.5% to hit US$7.50 per share. Earnings are an important time for investors, as they can track a company's performance, look at what the analysts are forecasting for next year, and see if there's been a change in sentiment towards the company. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on WEX after the latest results.
Check out our latest analysis for WEX
Following last week's earnings report, WEX's 15 analysts are forecasting 2025 revenues to be US$2.62b, approximately in line with the last 12 months. Per-share earnings are expected to rise 9.7% to US$8.54. In the lead-up to this report, the analysts had been modelling revenues of US$2.71b and earnings per share (EPS) of US$10.04 in 2025. The analysts seem less optimistic after the recent results, reducing their revenue forecasts and making a real cut to earnings per share numbers.
The consensus price target fell 14% to US$171, with the weaker earnings outlook clearly leading valuation estimates. It could also be instructive to look at the range of analyst estimates, to evaluate how different the outlier opinions are from the mean. Currently, the most bullish analyst values WEX at US$208 per share, while the most bearish prices it at US$140. Analysts definitely have varying views on the business, but the spread of estimates is not wide enough in our view to suggest that extreme outcomes could await WEX shareholders.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 0.2% by the end of 2025. This indicates a significant reduction from annual growth of 12% over the last five years. Compare this with our data, which suggests that other companies in the same industry are, in aggregate, expected to see their revenue grow 6.5% per year. It's pretty clear that WEX's revenues are expected to perform substantially worse than the wider industry.
The Bottom Line
The biggest concern is that the analysts reduced their earnings per share estimates, suggesting business headwinds could lay ahead for WEX. On the negative side, they also downgraded their revenue estimates, and forecasts imply they will perform worse than the wider industry. The consensus price target fell measurably, with the analysts seemingly not reassured by the latest results, leading to a lower estimate of WEX's future valuation.