Paychex, Inc. (NASDAQ:PAYX) to Issue Dividend Increase – $1.19 Per Share

Paychex, Inc. (NASDAQ:PAYX) declared a quarterly dividend on Friday, May 1st. Stockholders of record on Wednesday, May 13th will be paid a dividend of 1.19 per share by the business services provider on Friday, May 29th. This represents a c) dividend on an annualized basis and a dividend yield of 5.1%. The ex-dividend date of this dividend is Wednesday, May 13th. This is a 10.2% increase from Paychex’s previous quarterly dividend of $1.08.

Paychex has increased its dividend payment by an average of 0.1%per year over the last three years and has raised its dividend every year for the last 3 years. Paychex has a payout ratio of 84.0% indicating that its dividend is currently covered by earnings, but may not be in the future if the company’s earnings fall. Research analysts expect Paychex to earn $5.91 per share next year, which means the company should continue to be able to cover its $4.76 annual dividend with an expected future payout ratio of 80.5%.

Paychex Price Performance

Shares of Paychex stock opened at $93.93 on Monday. The firm’s 50 day moving average price is $92.50 and its 200-day moving average price is $103.62. The company has a quick ratio of 1.26, a current ratio of 1.26 and a debt-to-equity ratio of 1.13. Paychex has a 52-week low of $85.45 and a 52-week high of $161.24. The company has a market cap of $33.65 billion, a P/E ratio of 20.69 and a beta of 0.84.

Paychex (NASDAQ:PAYX) last issued its quarterly earnings data on Wednesday, March 25th. The business services provider reported $1.71 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $1.67 by $0.04. Paychex had a net margin of 25.84% and a return on equity of 48.52%. The firm had revenue of $1.81 billion for the quarter, compared to the consensus estimate of $1.78 billion. During the same quarter in the previous year, the firm earned $1.49 EPS. The company’s quarterly revenue was up 19.9% compared to the same quarter last year. On average, sell-side analysts predict that Paychex will post 5.5 EPS for the current fiscal year.

Wall Street Analyst Weigh In

Several research firms have weighed in on PAYX. BMO Capital Markets boosted their target price on shares of Paychex to $52.00 and gave the stock an “outperform” rating in a research report on Thursday, March 26th. Jefferies Financial Group lowered their price target on shares of Paychex from $110.00 to $105.00 and set a “hold” rating on the stock in a report on Thursday, March 26th. Wells Fargo & Company reduced their price objective on shares of Paychex from $116.00 to $95.00 and set an “underweight” rating for the company in a research report on Thursday, March 26th. Stephens reduced their price objective on shares of Paychex from $125.00 to $105.00 and set an “equal weight” rating for the company in a research report on Thursday, March 26th. Finally, JPMorgan Chase & Co. reduced their price objective on shares of Paychex from $125.00 to $100.00 and set an “underweight” rating for the company in a research report on Thursday, March 26th. One investment analyst has rated the stock with a Strong Buy rating, one has given a Buy rating, twelve have issued a Hold rating and four have given a Sell rating to the stock. According to data from MarketBeat, Paychex presently has a consensus rating of “Reduce” and an average target price of $106.38.

Paychex Company Profile

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.