DAVENPORT & Co LLC Increases Stock Position in Paychex, Inc. $PAYX

DAVENPORT & Co LLC lifted its position in shares of Paychex, Inc. (NASDAQ:PAYX) by 110.5% during the fourth quarter, according to its most recent disclosure with the Securities and Exchange Commission (SEC). The institutional investor owned 51,903 shares of the business services provider’s stock after purchasing an additional 27,251 shares during the period. DAVENPORT & Co LLC’s holdings in Paychex were worth $5,822,000 at the end of the most recent quarter.

Other hedge funds and other institutional investors have also added to or reduced their stakes in the company. Heartwood Wealth Advisors LLC purchased a new stake in Paychex in the 3rd quarter valued at about $25,000. Vermillion & White Wealth Management Group LLC bought a new position in shares of Paychex during the 3rd quarter worth approximately $27,000. Stance Capital LLC purchased a new position in shares of Paychex in the 3rd quarter worth approximately $31,000. MMA Asset Management LLC purchased a new position in shares of Paychex in the 3rd quarter worth approximately $32,000. Finally, Board of the Pension Protection Fund bought a new position in shares of Paychex in the fourth quarter valued at approximately $34,000. 83.47% of the stock is currently owned by hedge funds and other institutional investors.

Paychex News Summary

Here are the key news stories impacting Paychex this week:

• Positive Sentiment: Q3 beat: PAYX reported EPS of $1.71 (vs. $1.67 est.) and revenue of $1.81B (+20% YoY), demonstrating demand and top-line momentum that supports recurring-service growth. Zacks: Paychex’s Q3 Earnings and Revenues Surpass Estimates
• Positive Sentiment: Growth catalysts: Management highlighted AI initiatives and the Paycor acquisition as drivers of advisory and PEO growth that could expand addressable market and services revenue over time. MSN: PAYX Q1 deep dive: AI initiatives and Paycor integration
• Neutral Sentiment: Analysts largely kept neutral/hold ratings after the print — several firms reiterated balanced views citing solid fundamentals but ongoing macro and execution risks. That keeps near-term analyst guidance mixed rather than uniformly bullish. TipRanks: Solid fundamentals but macro and AI headwinds
• Negative Sentiment: Price-target cuts and downgrades: Multiple major firms trimmed targets and/or ratings this morning — JPMorgan to $100 (underweight), Citigroup to $99 (neutral), Wells Fargo to $95 (underweight), TD Cowen to $95 (hold). Those moves increase downside/near-term selling pressure despite the beat. Benzinga: Analyst price-target updates
• Negative Sentiment: Margin/cost concerns: Some coverage noted rising costs and margin pressure despite robust revenue growth — investors are attentive to whether operating leverage will recover. That commentary contributed to volatile trading after the report. Blockonomi: Cost pressures overshadow performance

Paychex Trading Up 0.2%

Shares of Paychex stock opened at $93.59 on Friday. Paychex, Inc. has a 52-week low of $86.89 and a 52-week high of $161.24. The stock’s 50-day simple moving average is $97.04 and its 200 day simple moving average is $111.26. The stock has a market capitalization of $33.60 billion, a P/E ratio of 20.61 and a beta of 0.91. The company has a debt-to-equity ratio of 1.13, a quick ratio of 1.27 and a current ratio of 1.26.

Paychex (NASDAQ:PAYX) last issued its earnings results on Wednesday, March 25th. The business services provider reported $1.71 earnings per share for the quarter, topping analysts’ consensus estimates of $1.67 by $0.04. The firm had revenue of $1.81 billion during the quarter, compared to analyst estimates of $1.78 billion. Paychex had a net margin of 25.84% and a return on equity of 48.52%. The company’s quarterly revenue was up 19.9% on a year-over-year basis. During the same quarter last year, the business earned $1.49 earnings per share. As a group, research analysts anticipate that Paychex, Inc. will post 4.99 EPS for the current year.

Paychex announced that its Board of Directors has initiated a share repurchase plan on Friday, January 16th that allows the company to buyback $1.00 billion in outstanding shares. This buyback authorization allows the business services provider to reacquire up to 2.5% of its shares through open market purchases. Shares buyback plans are often a sign that the company’s board of directors believes its stock is undervalued.

Paychex Dividend Announcement

The firm also recently declared a quarterly dividend, which was paid on Friday, February 27th. Investors of record on Wednesday, January 28th were paid a dividend of $1.08 per share. This represents a $4.32 dividend on an annualized basis and a dividend yield of 4.6%. The ex-dividend date was Wednesday, January 28th. Paychex’s dividend payout ratio is presently 97.96%.

Analysts Set New Price Targets

A number of analysts recently commented on the company. TD Cowen decreased their price target on Paychex from $114.00 to $95.00 and set a “hold” rating for the company in a research report on Thursday. Guggenheim began coverage on Paychex in a research note on Thursday, March 19th. They issued a “neutral” rating for the company. Jefferies Financial Group set a $110.00 target price on Paychex in a research report on Friday, December 19th. Stephens lowered their target price on Paychex from $135.00 to $125.00 and set an “equal weight” rating on the stock in a research note on Monday, December 22nd. Finally, Citigroup cut their price target on shares of Paychex from $120.00 to $99.00 and set a “neutral” rating on the stock in a report on Thursday. One analyst has rated the stock with a Buy rating, thirteen have issued a Hold rating and four have assigned a Sell rating to the company. According to data from MarketBeat.com, the stock presently has an average rating of “Reduce” and a consensus target price of $114.56.

About Paychex

Paychex, Inc, founded in 1971 by B. Thomas “Tom” Golisano and headquartered in Rochester, New York, is a provider of payroll, human resources, and benefits outsourcing solutions for small- and medium-sized businesses. The company’s core services include payroll processing and tax filing, employee benefits administration, retirement services, and workers’ compensation administration, designed to simplify back-office operations and help clients comply with regulatory and tax requirements.

Paychex offers an integrated technology platform, marketed under the Paychex Flex brand, which delivers cloud-based payroll, HR, time and attendance, and reporting tools.