Overall WEX gets a fundamental rating of 4 out of 10. We evaluated WEX against 97 industry peers in the Financial Services industry. WEX has an excellent profitability rating, but there are concerns on its financial health. WEX has a correct valuation and a medium growth rate.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

WEX had positive earnings in the past year.
In the past year WEX had a positive cash flow from operations.
Of the past 5 years WEX 4 years were profitable.
In the past 5 years WEX always reported a positive cash flow from operatings.

1.2 Ratios

With a decent Return On Assets value of 1.97%, WEX is doing good in the industry, outperforming 60.82% of the companies in the same industry.
WEX has a Return On Equity of 25.38%. This is amongst the best in the industry. WEX outperforms 90.72% of its industry peers.
With a decent Return On Invested Capital value of 7.87%, WEX is doing good in the industry, outperforming 75.26% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for WEX is in line with the industry average of 8.46%.

		Industry Rank	Sector Rank
ROA	1.97%
ROE	25.38%
ROIC	7.87%

ROA(3y)2%

ROA(5y)0.6%

ROE(3y)15.88%

ROE(5y)6.97%

ROIC(3y)8.63%

ROIC(5y)6.48%

1.3 Margins

WEX's Profit Margin of 10.81% is in line compared to the rest of the industry. WEX outperforms 53.61% of its industry peers.
In the last couple of years the Profit Margin of WEX has grown nicely.
WEX has a better Operating Margin (29.09%) than 77.32% of its industry peers.
In the last couple of years the Operating Margin of WEX has grown nicely.
The Gross Margin of WEX (63.19%) is better than 75.26% of its industry peers.
WEX's Gross Margin has been stable in the last couple of years.

		Industry Rank	Sector Rank
OM	29.09%
PM (TTM)	10.81%
GM	63.19%

OM growth 3Y15.67%

OM growth 5Y3.83%

PM growth 3Y1067.47%

PM growth 5Y15.45%

GM growth 3Y1.01%

GM growth 5Y0.1%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so WEX is still creating some value.
WEX has less shares outstanding than it did 1 year ago.
The number of shares outstanding for WEX has been reduced compared to 5 years ago.
Compared to 1 year ago, WEX has a worse debt to assets ratio.

2.2 Solvency

Based on the Altman-Z score of 0.52, we must say that WEX is in the distress zone and has some risk of bankruptcy.
WEX has a Altman-Z score (0.52) which is in line with its industry peers.
The Debt to FCF ratio of WEX is 7.82, which is on the high side as it means it would take WEX, 7.82 years of fcf income to pay off all of its debts.
WEX has a Debt to FCF ratio of 7.82. This is comparable to the rest of the industry: WEX outperforms 46.39% of its industry peers.
WEX has a Debt/Equity ratio of 4.44. This is a high value indicating a heavy dependency on external financing.
With a Debt to Equity ratio value of 4.44, WEX is not doing good in the industry: 79.38% of the companies in the same industry are doing better.

		Industry Rank	Sector Rank
Debt/Equity	4.44
Debt/FCF	7.82
Altman-Z	0.52

ROIC/WACC0.93

WACC8.49%

2.3 Liquidity

A Current Ratio of 0.57 indicates that WEX may have some problems paying its short term obligations.
The Current ratio of WEX (0.57) is comparable to the rest of the industry.
WEX has a Quick Ratio of 0.57. This is a bad value and indicates that WEX is not financially healthy enough and could expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 0.57, WEX is in line with its industry, outperforming 40.21% of the companies in the same industry.

		Industry Rank	Sector Rank
Current Ratio	0.57
Quick Ratio	0.57

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has been growing slightly by 0.58% over the past year.
The Earnings Per Share has been growing by 10.68% on average over the past years. This is quite good.
WEX shows a decrease in Revenue. In the last year, the revenue decreased by -1.15%.
Measured over the past years, WEX shows a quite strong growth in Revenue. The Revenue has been growing by 8.80% on average per year.

EPS 1Y (TTM)0.58%

EPS 3Y18.73%

EPS 5Y10.68%

EPS Q2Q%5.52%

Revenue 1Y (TTM)-1.15%

Revenue growth 3Y12.4%

Revenue growth 5Y8.8%

Sales Q2Q%3.95%

3.2 Future

WEX is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 8.79% yearly.
WEX is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.21% yearly.

EPS Next Y5.29%

EPS Next 2Y7.78%

EPS Next 3Y8.01%

EPS Next 5Y8.79%

Revenue Next Year0.87%

Revenue Next 2Y2.46%

Revenue Next 3Y3.44%

Revenue Next 5Y4.21%

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.

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4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 10.24, which indicates a very decent valuation of WEX.
Based on the Price/Earnings ratio, WEX is valued a bit cheaper than the industry average as 62.89% of the companies are valued more expensively.
WEX's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 27.21.
A Price/Forward Earnings ratio of 9.01 indicates a reasonable valuation of WEX.
61.86% of the companies in the same industry are more expensive than WEX, based on the Price/Forward Earnings ratio.
WEX is valuated cheaply when we compare the Price/Forward Earnings ratio to 25.98, which is the current average of the S&P500 Index.

		Industry Rank	Sector Rank
PE	10.24
Fwd PE	9.01

4.2 Price Multiples

WEX's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. WEX is cheaper than 78.35% of the companies in the same industry.
79.38% of the companies in the same industry are more expensive than WEX, based on the Price/Free Cash Flow ratio.

		Industry Rank	Sector Rank
P/FCF	8.54
EV/EBITDA	7.72

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates WEX does not grow enough to justify the current Price/Earnings ratio.
WEX has a very decent profitability rating, which may justify a higher PE ratio.