Analysts Set Paychex, Inc. (NASDAQ:PAYX) PT at $123.94

Shares of Paychex, Inc. (NASDAQ:PAYX) have been assigned an average recommendation of “Reduce” from the eighteen brokerages that are covering the firm, MarketBeat reports. Four investment analysts have rated the stock with a sell recommendation, thirteen have assigned a hold recommendation and one has given a buy recommendation to the company. The average 1 year target price among analysts that have issued ratings on the stock in the last year is $123.9375.

PAYX has been the topic of a number of recent research reports. BMO Capital Markets cut their target price on Paychex from $140.00 to $121.00 and set a “market perform” rating on the stock in a research note on Tuesday, December 9th. Jefferies Financial Group set a $110.00 price objective on shares of Paychex in a research report on Friday, December 19th. Stifel Nicolaus reduced their price objective on shares of Paychex from $137.00 to $126.00 and set a “hold” rating for the company in a research note on Wednesday, December 17th. Argus reduced their price target on shares of Paychex from $150.00 to $130.00 and set a “buy” rating for the company in a research report on Friday, January 2nd. Finally, Cantor Fitzgerald upgraded Paychex to a “strong sell” rating in a research note on Tuesday, January 27th.

Institutional Inflows and Outflows

Hedge funds and other institutional investors have recently added to or reduced their stakes in the stock. Vanguard Group Inc. raised its stake in Paychex by 12.1% during the 4th quarter. Vanguard Group Inc. now owns 42,348,625 shares of the business services provider’s stock valued at $4,750,669,000 after buying an additional 4,583,157 shares during the last quarter. Capital International Investors grew its holdings in shares of Paychex by 59.1% in the fourth quarter. Capital International Investors now owns 30,265,174 shares of the business services provider’s stock worth $3,395,583,000 after acquiring an additional 11,243,295 shares during the period. State Street Corp increased its position in Paychex by 2.6% during the second quarter. State Street Corp now owns 14,066,067 shares of the business services provider’s stock valued at $2,046,050,000 after acquiring an additional 355,294 shares during the last quarter. Charles Schwab Investment Management Inc. lifted its holdings in Paychex by 2.3% in the fourth quarter. Charles Schwab Investment Management Inc. now owns 11,550,173 shares of the business services provider’s stock valued at $1,295,698,000 after acquiring an additional 263,152 shares during the period. Finally, Geode Capital Management LLC lifted its holdings in Paychex by 2.8% in the second quarter. Geode Capital Management LLC now owns 10,183,871 shares of the business services provider’s stock valued at $1,481,053,000 after acquiring an additional 274,947 shares during the period. Institutional investors own 83.47% of the company’s stock.

Paychex Price Performance

Shares of PAYX opened at $91.24 on Wednesday. Paychex has a fifty-two week low of $90.32 and a fifty-two week high of $161.24. The firm’s 50-day simple moving average is $106.38 and its two-hundred day simple moving average is $118.74. The stock has a market cap of $32.75 billion, a PE ratio of 20.69 and a beta of 0.90. 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 (NASDAQ:PAYX) last issued its quarterly 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. Paychex had a return on equity of 46.38% and a net margin of 26.45%.The firm had revenue of $1.56 billion for the quarter, compared to analysts’ expectations of $1.55 billion. During the same period in the previous year, the firm posted $1.14 EPS. The business’s revenue for the quarter was up 18.3% compared to the same quarter last year. Paychex has set its FY 2026 guidance at 5.480-5.530 EPS. Analysts anticipate that Paychex will post 4.99 earnings per share for the current fiscal year.

Paychex Announces Dividend

The firm also recently announced a quarterly dividend, which will be paid on Friday, February 27th. Shareholders of record on Wednesday, January 28th will be given a $1.08 dividend. The ex-dividend date of this dividend is Wednesday, January 28th. This represents a $4.32 dividend on an annualized basis and a yield of 4.7%. Paychex’s payout ratio is 97.96%.

Paychex declared that its Board of Directors has authorized a share buyback program on Friday, January 16th that allows the company to repurchase $1.00 billion in shares. This repurchase authorization allows the business services provider to reacquire up to 2.5% of its shares through open market purchases. Shares repurchase programs are generally an indication that the company’s board believes its shares are undervalued.

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.