WEX Readies to Report Q2 Earnings: What's in the Offing?

WEX Inc. WEX will report second-quarter 2020 results on Jul 30, before market open.

Let's discuss how things are shaped prior to the announcement.

Q2 Expectations

The Zacks Consensus Estimate for second-quarter revenues is pegged at $352.8 million, which indicates a decline of 20.1% from the year-ago quarter’s reported figure. Weak travel and feet volumes due to restrictions on travel and business are likely to have put pressure on the top line in the to-be-reported quarter.

The Zacks Consensus Estimate for Fleet Solutions revenues (likely to contribute significant portion of the top line) suggests a year-over-year fall of 15.7%. Also, the consensus mark for travel and corporate solutions revenue indicates a fall of 43.9% from the prior-year quarter’s reported figure.

In the first quarter, WEX reported revenues of $431.7 million, up 13% year over year.

The Zacks Consensus Estimate for earnings in the to-be-reported quarter is pegged at $1.42, which calls for a decline of 37.7% from the year-ago quarter’s reported figure. The downside is likely to have been caused by high fuel prices.

WEX Inc. Price and EPS Surprise

WEX Inc. Price and EPS Surprise

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

WEX’s first-quarter earnings of $1.81 per share increased 5.2% year over year.

What Our Model Says

Our proven model does not conclusively predict an earnings beat for WEX this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter.

WEX has an Earnings ESP of -4.56% and a Zacks Rank #3.

Stocks to Consider

Here are some stocks from the broader Zacks Business Services sector that investors may consider, as our model shows that these have the right combination of elements to beat on earnings.

Republic Services RSG has an Earnings ESP of +6.49% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Aptiv APTV has an Earnings ESP of +7.02% and a Zacks Rank #3.

Waste Connections WCN has an Earnings ESP of +6.29% and a Zacks Rank #3.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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