Paychex, Inc. (NASDAQ:PAYX) Receives Average Recommendation of “Reduce” from Analysts

Paychex, Inc. (NASDAQ:PAYX) has been given an average rating of “Reduce” by the eighteen ratings firms that are presently covering the firm, MarketBeat reports. Four investment analysts have rated the stock with a sell rating, thirteen have given a hold rating and one has issued a buy rating on the company. The average 12-month price objective among analysts that have updated their coverage on the stock in the last year is $122.8125.

A number of equities research analysts have issued reports on the stock. Morgan Stanley cut their price target on shares of Paychex from $133.00 to $123.00 and set an “equal weight” rating on the stock in a report on Monday, December 22nd. Citigroup lowered their price objective on shares of Paychex from $139.00 to $120.00 and set a “neutral” rating for the company in a research note on Monday, December 22nd. Cantor Fitzgerald upgraded shares of Paychex to a “strong sell” rating in a report on Tuesday, January 27th. Wolfe Research reduced their price target on Paychex from $130.00 to $115.00 and set an “underperform” rating on the stock in a report on Wednesday, December 10th. Finally, Jefferies Financial Group set a $110.00 price objective on Paychex in a report on Friday, December 19th.

Paychex Trading Up 1.0%

PAYX stock opened at $92.61 on Friday. The company has a market capitalization of $33.24 billion, a PE ratio of 21.00 and a beta of 0.91. The company has a debt-to-equity ratio of 1.17, a quick ratio of 1.27 and a current ratio of 1.27. Paychex has a one year low of $86.89 and a one year high of $161.24. The company’s 50 day moving average price is $100.48 and its two-hundred day moving average price is $113.92.

Paychex (NASDAQ:PAYX) last issued its earnings results on Friday, December 19th. The business services provider reported $1.26 EPS for the quarter, topping analysts’ consensus estimates of $1.23 by $0.03. The company had revenue of $1.56 billion for the quarter, compared to analysts’ expectations of $1.55 billion. Paychex had a net margin of 26.45% and a return on equity of 46.38%. The firm’s revenue was up 18.3% compared to the same quarter last year. During the same quarter last year, the company earned $1.14 EPS. Paychex has set its FY 2026 guidance at 5.480-5.530 EPS. As a group, analysts predict that Paychex will post 4.99 earnings per share for the current fiscal year.

Paychex Announces Dividend

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 $1.08 dividend. The ex-dividend date of this dividend was Wednesday, January 28th. This represents a $4.32 dividend on an annualized basis and a yield of 4.7%. Paychex’s dividend payout ratio (DPR) is presently 97.96%.

Paychex announced that its board has authorized a stock repurchase plan on Friday, January 16th that authorizes the company to repurchase $1.00 billion in outstanding shares. This repurchase authorization authorizes the business services provider to buy up to 2.5% of its stock through open market purchases. Stock repurchase plans are typically an indication that the company’s leadership believes its stock is undervalued.

Institutional Inflows and Outflows

Institutional investors have recently added to or reduced their stakes in the stock. Empirical Finance LLC increased its position in shares of Paychex by 0.7% during the second quarter. Empirical Finance LLC now owns 11,267 shares of the business services provider’s stock valued at $1,639,000 after buying an additional 75 shares during the period. Quantum Portfolio Management LLC boosted its position in Paychex by 3.1% during the 2nd quarter. Quantum Portfolio Management LLC now owns 2,464 shares of the business services provider’s stock valued at $358,000 after acquiring an additional 75 shares in the last quarter. FAS Wealth Partners Inc. boosted its position in Paychex by 3.3% during the 2nd quarter. FAS Wealth Partners Inc. now owns 2,597 shares of the business services provider’s stock valued at $378,000 after acquiring an additional 83 shares in the last quarter. Somerset Trust Co grew its holdings in shares of Paychex by 0.3% during the 3rd quarter. Somerset Trust Co now owns 32,964 shares of the business services provider’s stock worth $4,179,000 after acquiring an additional 84 shares during the period. Finally, Suncoast Equity Management grew its holdings in shares of Paychex by 0.6% during the 3rd quarter. Suncoast Equity Management now owns 14,055 shares of the business services provider’s stock worth $1,782,000 after acquiring an additional 85 shares during the period. 83.47% of the stock is currently owned by institutional investors.

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.