WEX Stock Price Decreases 5% Post Q3 Earnings & Revenues Miss

Core Viewpoint - WEX Inc. reported disappointing third-quarter 2024 results, with earnings and revenues falling short of Zacks Consensus Estimates, leading to a decline in stock price and lowered guidance for future quarters [1][2]. Financial Performance - For Q4 2024, WEX revised its revenue guidance down to $630-$640 million from the previous $688-$698 million, with the midpoint of $635 million slightly above the Zacks Consensus Estimate of $633.8 million [2]. - The adjusted diluted earnings per share (EPS) guidance was lowered to $3.51-$3.61 from $4.42-$4.52, which is below the consensus estimate of $3.66 per share [3]. - For the full year 2024, revenue guidance was also reduced to $2.62-$2.63 billion from $2.68-$2.72 billion, again below the Zacks Consensus Estimate of $2.64 billion [3]. Quarterly Results - WEX's adjusted diluted EPS for the quarter was reported at $4.4, missing the Zacks Consensus Estimate by 1.6%, but showing a year-over-year increase of 7.4% [4]. - Revenues for the quarter were $665.5 million, which missed the consensus estimate by 3.3%, but increased by 2.2% compared to the same quarter last year [4]. Segment Performance - The Mobility segment's revenues grew by 2% year-over-year to $357.2 million, exceeding estimates, driven by investments in digital marketing [6]. - The Corporate Payments segment reported revenues of $126.9 million, down 6.1% from the previous year and missing estimates [6]. - The Benefits segment saw a 9.3% year-over-year revenue increase to $181.5 million, although it also fell short of projections [7]. Operating Results - Adjusted operating income rose 12.3% to $196.4 million year-over-year, but missed estimates significantly [8]. - The adjusted operating income margin improved to 47.6%, which was above projections [8]. Balance Sheet and Cash Flow - At the end of Q3 2024, WEX had cash and cash equivalents of $682.6 million, a significant increase from $7 million in the previous quarter [9]. - Long-term debt decreased to $3 billion from $3.1 billion [9]. - The company reported a cash utilization of $7 million from operating activities and an adjusted free cash flow utilization of $161.1 million [9]. Stock Performance - WEX's stock has declined by 18.1% over the past six months, contrasting with a 14.4% rise in its industry and a 15.4% increase in the Zacks S&P 500 Composite [5].