Wex (WEX) holds a strong market position in fuel cards, corporate payments, and benefits administration, which positions the company to capture secular growth trends in its end markets, Oppenheimer said in a research note Thursday.

The company's competitive advantages include its proprietary closed-loop payment network, WEX Bank, and its ability to serve nearly 60% of the Fortune 1000 through its Benefits segment. Its diversified end-market exposure also provides some insulation against sector-specific weakness.

However, Oppenheimer noted that Wex's customers remain vulnerable to an economic downturn, creating uncertainty around the timing of the company's return to its recently lowered medium-term organic top-line growth target of 5% to 10%, down from 8% to 12%. Exposure to declining fuel prices further contributes to near-term challenges.

For 2025, the brokerage models a 1% decline in total revenue to $2.597 billion, or a 2% increase excluding fuel and foreign exchange impacts.

The Benefits segment is expected to grow revenue by 6%, while Corporate Payments revenue may decline 6% due to a large customer transition, with growth expected to resume in the third quarter. Mobility revenue is projected to fall 3%, impacted by lower fuel prices and same-store sales softness.

Adjusted EPS is forecast to decrease 1% to $15.07, largely in line with consensus, as margin pressures arise from fixed costs in Corporate Payments and lower Mobility margins due to fuel price declines, according to the note.

The firm noted that revenue and EPS growth could reaccelerate in 2026 if economic conditions stabilize, helped by easier comparisons in Corporate Payments and potential recovery in the Mobility segment.

Oppenheimer initiated coverage on the company's stock with a perform rating.

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