Paychex (NASDAQ:PAYX) Issues Quarterly Earnings Results

Paychex (NASDAQ:PAYX) posted its earnings results on Tuesday. The business services provider reported $1.38 EPS for the quarter, beating analysts’ consensus estimates of $1.37 by $0.01, Briefing.com reports. Paychex had a net margin of 31.86% and a return on equity of 46.14%. The business had revenue of $1.44 billion for the quarter, compared to the consensus estimate of $1.46 billion. During the same quarter last year, the firm posted $1.29 EPS. The company’s revenue for the quarter was up 4.2% on a year-over-year basis. Paychex updated its FY 2024 guidance to 4.700-4.740 EPS.

Paychex Stock Performance

Shares of PAYX stock traded up $0.91 during mid-day trading on Thursday, reaching $121.17. The stock had a trading volume of 452,617 shares, compared to its average volume of 1,739,626. The company has a current ratio of 1.24, a quick ratio of 1.23 and a debt-to-equity ratio of 0.21. Paychex has a 1-year low of $104.09 and a 1-year high of $129.70. The firm has a market cap of $43.60 billion, a price-to-earnings ratio of 26.45, a PEG ratio of 3.30 and a beta of 0.93. The business’s fifty day moving average is $121.94 and its 200-day moving average is $119.62.

Paychex Announces Dividend

The company also recently announced a quarterly dividend, which was paid on Tuesday, February 27th. Investors of record on Tuesday, February 13th were given a $0.89 dividend. This represents a $3.56 annualized dividend and a dividend yield of 2.94%. The ex-dividend date was Monday, February 12th. Paychex’s payout ratio is 77.56%.

Paychex announced that its board has authorized a stock buyback plan on Friday, January 19th that permits the company to buyback $400.00 million in outstanding shares. This buyback authorization permits the business services provider to reacquire up to 0.9% of its stock through open market purchases. Stock buyback plans are generally an indication that the company’s board believes its shares are undervalued.

Analysts Set New Price Targets

Several brokerages recently issued reports on PAYX. Barclays cut their price objective on shares of Paychex from $126.00 to $120.00 and set an “equal weight” rating on the stock in a report on Friday, December 22nd. Bank of America lifted their price target on Paychex from $108.00 to $111.00 and gave the company an “underperform” rating in a report on Wednesday. Evercore ISI restated an “in-line” rating and set a $118.00 price objective on shares of Paychex in a research note on Tuesday, March 26th. Royal Bank of Canada reaffirmed a “sector perform” rating and set a $130.00 price objective on shares of Paychex in a research report on Wednesday. Finally, Stifel Nicolaus boosted their target price on shares of Paychex from $124.00 to $130.00 and gave the stock a “hold” rating in a report on Friday, December 22nd. Two investment analysts have rated the stock with a sell rating and ten have issued a hold rating to the stock. According to MarketBeat.com, Paychex currently has an average rating of “Hold” and an average target price of $123.00.

Insider Activity at Paychex

In other Paychex news, VP Mark Anthony Bottini sold 15,481 shares of the firm’s stock in a transaction that occurred on Monday, January 29th. The shares were sold at an average price of $120.53, for a total transaction of $1,865,924.93. Following the completion of the transaction, the vice president now directly owns 82,690 shares of the company’s stock, valued at approximately $9,966,625.70. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through this link. 11.50% of the stock is owned by insiders.

Institutional Investors Weigh In On Paychex

Several hedge funds and other institutional investors have recently added to or reduced their stakes in the stock. Vanguard Group Inc. increased its holdings in shares of Paychex by 1.6% during the 4th quarter. Vanguard Group Inc. now owns 30,418,038 shares of the business services provider’s stock valued at $3,623,093,000 after purchasing an additional 487,031 shares in the last quarter. Geode Capital Management LLC boosted its stake in shares of Paychex by 0.8% during the 1st quarter. Geode Capital Management LLC now owns 7,982,029 shares of the business services provider’s stock worth $913,599,000 after acquiring an additional 62,739 shares in the last quarter. Charles Schwab Investment Management Inc. grew its position in shares of Paychex by 8.0% during the 1st quarter. Charles Schwab Investment Management Inc. now owns 5,144,822 shares of the business services provider’s stock valued at $702,115,000 after acquiring an additional 379,291 shares during the period. Moneta Group Investment Advisors LLC grew its position in shares of Paychex by 102,768.9% during the 4th quarter. Moneta Group Investment Advisors LLC now owns 4,537,548 shares of the business services provider’s stock valued at $524,359,000 after acquiring an additional 4,533,137 shares during the period. Finally, Morgan Stanley increased its stake in shares of Paychex by 9.6% in the 4th quarter. Morgan Stanley now owns 3,826,640 shares of the business services provider’s stock valued at $442,207,000 after purchasing an additional 336,299 shares in the last quarter. 83.47% of the stock is owned by institutional investors and hedge funds.

About Paychex

Paychex, Inc provides integrated human capital management solutions for human resources (HR), payroll, benefits, and insurance services for small to medium-sized businesses in the United States, Europe, and India. It offers payroll processing services; payroll tax administration services; employee payment services; and regulatory compliance services, such as new-hire reporting and garnishment processing.