Paychex (NASDAQ:PAYX) Posts Earnings Results, Beats Expectations By $0.02 EPS

Key Points

• Paychex beat earnings expectations: The company reported quarterly EPS of $1.34, surpassing the $1.32 consensus estimate, while revenue of $1.63 billion matched expectations.
• Dividend remains substantial: Paychex declared a quarterly dividend of $1.19 per share, equivalent to a $4.76 annualized payout and a 4.2% yield; its payout ratio stands at 97.34%.
• Analyst sentiment is mixed: Paychex has a consensus “Hold” rating and an average price target of $126.76, while recent insider activity included stock sales by the CFO and a director.

Paychex (NASDAQ:PAYX - Get Free Report) posted its earnings results on Wednesday. The business services provider reported $1.34 EPS for the quarter, beating analysts' consensus estimates of $1.32 by $0.02, FiscalAI reports. Paychex had a return on equity of 50.90% and a net margin of 27.03%.The firm had revenue of $1.63 billion during the quarter, compared to the consensus estimate of $1.63 billion.

Paychex Stock Performance

PAYX opened at $114.53 on Wednesday. The firm has a market capitalization of $40.74 billion, a PE ratio of 23.42, a PEG ratio of 2.41 and a beta of 0.82. The company has a current ratio of 1.26, a quick ratio of 1.26 and a debt-to-equity ratio of 1.22. Paychex has a twelve month low of $85.45 and a twelve month high of $130.64. The firm's 50-day moving average price is $119.15 and its 200 day moving average price is $104.05.

Paychex Dividend Announcement

The company also recently declared a quarterly dividend, which was paid on Friday, August 28th. Investors of record on Tuesday, July 28th were given a dividend of $1.19 per share. This represents a $4.76 annualized dividend and a dividend yield of 4.2%. The ex-dividend date was Tuesday, July 28th. Paychex's payout ratio is presently 97.34%.

Analyst Ratings Changes

PAYX has been the subject of a number of research analyst reports. Weiss Ratings upgraded shares of Paychex from a "hold (c-)" rating to a "hold (c)" rating in a report on Monday, July 20th. Cantor Fitzgerald reaffirmed an "underweight" rating and issued a $107.00 price target on shares of Paychex in a report on Monday, July 20th. UBS Group lifted their target price on shares of Paychex from $105.00 to $115.00 and gave the stock a "neutral" rating in a research note on Wednesday, July 22nd. Raymond James Financial upgraded shares of Paychex from a "market perform" rating to an "outperform" rating and set a $210.00 price target on the stock in a research note on Thursday, July 16th. Finally, Stephens began coverage on shares of Paychex in a report on Friday, September 4th. They issued an "equal weight" rating and a $132.00 price target for the company. One analyst has rated the stock with a Strong Buy rating, three have issued a Buy rating, eleven have issued a Hold rating and three have issued a Sell rating to the company's stock. According to MarketBeat, Paychex presently has a consensus rating of "Hold" and a consensus target price of $126.76.

Insider Buying and Selling

In related news, CFO Robert L. Schrader sold 2,600 shares of the company's stock in a transaction that occurred on Monday, July 20th. The stock was sold at an average price of $115.09, for a total value of $299,234.00. Following the transaction, the chief financial officer directly owned 18,547 shares in the company, valued at approximately $2,134,574.23. This represents a 12.29% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is accessible through this link. Also, Director Joseph M. Tucci sold 3,907 shares of the company's stock in a transaction on Friday, June 26th. The shares were sold at an average price of $98.25, for a total value of $383,862.75. Following the completion of the transaction, the director directly owned 67,364 shares in the company, valued at approximately $6,618,513. This trade represents a 5.48% decrease in their position. The disclosure for this sale is available in the SEC filing. Company insiders own 0.60% of the company's stock.

Paychex Company Profile

Paychex, Inc is a provider of payroll, human resources, and workforce management solutions for businesses of varying sizes. Its offerings include payroll processing, tax administration, time and attendance tracking, employee benefits administration, retirement services, workers' compensation and business insurance, recruiting, and compliance support.

The company also provides professional employer organization services, helping businesses manage employment administration and human resources through an integrated platform.

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