Here's Why Wex Stock Plunged Today
Shares of financial technology (fintech) company (NYSE: WEX) plunged on Thursday after reporting financial results for the third quarter of 2024 that fell well below management's prior guidance. As of 3:10 p.m. ET, Wex stock was down 14%.
Wex is an enterprise fintech company specializing in fuel cards, corporate travel, and benefits-management software. In Q3, the company generated revenue of $665 million, which was a record. But this was only up 2% year over year, and it fell short of management's guidance of $688 million to $698 million.
In short, a large part of Wex's business relies on fuel prices. It takes a cut when customers use its fuel cards, but the cut is smaller when gas prices fall. Q3 fuel prices dropped, resulting in a $21 million headwind. And this headwind caused management to lower its full-year revenue guidance. Previously, it believed it would generate at least $2.68 billion in full-year revenue, but now it believes $2.63 billion will be a best-case scenario.
Source Fool.com
