WEX (NYSE: WXS) and Western Union Company (The) (NYSE:WU) are both industrials companies, but which is the superior investment? We will compare the two companies based on the strength of their earnings, risk, valuation, dividends, profitabiliy, analyst recommendations and institutional ownership.

Profitability

This table compares WEX and Western Union Company (The)’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
WEX 5.48% 4.41% 1.07%
Western Union Company (The) 3.50% 84.38% 9.02%

Valuation & Earnings

This table compares WEX and Western Union Company (The)’s gross revenue, earnings per share (EPS) and valuation.

Gross Revenue Price/Sales Ratio EBITDA Earnings Per Share Price/Earnings Ratio
WEX N/A N/A N/A N/A N/A
Western Union Company (The) $5.43 billion 1.71 $1.36 billion $0.39 50.57

Western Union Company (The) has higher revenue and earnings than WEX.

Analyst Recommendations

This is a breakdown of current ratings and price targets for WEX and Western Union Company (The), as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
WEX 0 0 0 0 N/A
Western Union Company (The) 4 5 1 0 1.70

Western Union Company (The) has a consensus price target of $20.22, indicating a potential upside of 2.55%. Given Western Union Company (The)’s higher possible upside, analysts plainly believe Western Union Company (The) is more favorable than WEX.

Dividends

Western Union Company (The) pays an annual dividend of $0.70 per share and has a dividend yield of 3.5%. WEX does not pay a dividend. Western Union Company (The) pays out 179.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Western Union Company (The) has increased its dividend for 2 consecutive years.

Summary

Western Union Company (The) beats WEX on 7 of the 9 factors compared between the two stocks.

WEX Company Profile

WEX Inc. is a provider of corporate payment solutions. The Company operates through three segments: Fleet Solutions, Travel and Corporate Solutions, and Health and Employee Benefit Solutions. The Fleet Solutions segment provides customers with payment and transaction processing services designed for the needs of commercial and government fleets. The Travel and Corporate Solutions segment focuses on the complex payment environment of business-to-business payments, providing customers with payment processing solutions for their corporate payment and transaction monitoring needs. The Health and Employee Benefit Solutions segment provides healthcare payment products and software as a service consumer directed platforms, as well as payroll related benefits to customers in Brazil. The United States operations include the Company and its subsidiaries WEX Bank, WEX FleetOne, Electronic Funds Source LLC and WEX Health.

Western Union Company (The) Company Profile

The Western Union Company (Western Union) is a provider of money movement and payment services. The Company operates through three segments: Consumer-to-Consumer, Consumer-to-Business and Business Solutions. The Company’s Consumer-to-Consumer segment facilitates money transfers between two consumers, primarily through a network of third-party agents. The Company’s Consumer-to-Business segment provides options to make one-time or recurring payments from consumers to businesses and other organizations, including utilities, auto finance companies, mortgage servicers, financial service providers and government agencies. Its Consumer-to-Business payments services are available through a range of services that include Speedpay, Pago Facil and Western Union Payments. Western Union’s Business Solutions segment facilitates payment and foreign exchange solutions, primarily cross-border, cross-currency transactions, for small and medium size enterprises and other organizations and individuals.

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