2. Wright Express
Shares of Wright Express ( WXS) of South Portland, Maine, closed at $70.11 Thursday, returning 29% year-to-date, following an 18% return during 2011.

The company focuses on providing payment processing and management services to commercial and government fleets.

The shares trade for 15 times the consensus 2013 EPS estimate of $4.72.

Sakhrani's price target of $85 implies 21% upside for the shares.

The consensus among analysts is for Wright Express to report third-quarter earnings of $1.21 a share, increasing from a dollar in the second quarter, and $1.18 in the third quarter of 2011.

Sakhrani estimates that Wright Express will report third-quarter EPS of $1.12, with full-year EPS estimates of $4.10 for 2012 and $4.54 for 2013.

The analyst said that "Same-store sales were down 1% yr/yr in 2Q12, which compares to down about 0.5% yr/yr in 1Q12," and that "WXS noted on its 2Q12 earnings call that its larger clients remain cautious on the U.S. economy, but still expect to see modest growth. Given the economic uncertainty, we think investors are likely to remain focused on same-store sales trends for the quarter and beyond."

For the company's Other Payments segment, Sakhrani said that because of recent acquisitions and contract signings, KBW is "assuming 30% year/year volume growth in 3Q12, which compares to 48.5% year/year in 2Q12 and 83.5% year/year in 3Q11."

Sakhrani added that "WXS recently acquired Fleet One, a North American over-the-road (OTR) and local retail fueling business, from private equity firms LRR Partners and FTV Capital for $369 million in cash," and estimated "potential annual adjusted EPS accretion of between $0.20/share to $0.30/share (with the low end occurring over the near term and high-end over the medium term)."

WXS Chart WXS data by YCharts

Interested in more on Wright Express? See TheStreet Ratings' report card for this stock.

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