The Best Stock in Maine: WEX Inc.
We analyzed publicly traded companies based in the Pine Tree state to identify the best stock in Maine to buy now.
A word of caution: Since we selected a single stock from each state (plus one from D.C), and choices in some states are sparse, a few of our picks are best suited to investors comfortable with a higher degree of risk. This is not necessarily one of our 51 favorite stocks in the entire U.S., in other words.
WEX Inc. by the Numbers
- Headquarters: South Portland
- Share price: $102.09
- Market value: $4.4 billion
- Price-earnings ratio: 19
(Prices and data are as of June 22, 2017)
Wex provides electronic-payment processing and credit card services for the travel and trucking industries, as well as a health care benefits administration platform.
The company posted excellent first-quarter results, with sales growing 41% from the same quarter last year and earnings climbing 27%. So far this year, however, the share price has slid 8.5%. William Blair analyst Robert Napoli says shares are undervalued thanks to a bearish report on Wex’s primary competitor, as well as recent fuel-price declines, which impact the amount truckers charge on the company’s fuel-payment cards. But the company’s growth prospects are bright. Its fleet business in Brazil, for instance, is targeting the 4 million commercial vehicles in the nation that lack the kind of fuel cards Wex sells. Napoli believes the Brazil segment, which accounts for 5% to 10% of Wex’s total revenue, will continue to see sales grow at a 20% clip. Factoring in partnerships with Chevron and Texaco, which are set to begin in 2018, he sees annual earnings growth in the mid-teen percentages through 2019, with the possibility of some strategic mergers and acquisitions bumping growth rates higher. He calls the recent slide in price an “attractive entry point” and says the stock will beat the broad market over the next 12 months.