Conning Inc. Sells 235,004 Shares of Paychex, Inc. $PAYX

Key Points

• Conning Inc. sharply reduced its Paychex position in the fourth quarter, selling 235,004 shares and cutting its stake by 96.3% to 9,092 shares worth about $1.02 million.
• Paychex reported better-than-expected quarterly results, posting EPS of $1.71 versus the $1.67 estimate and revenue of $1.81 billion, up 19.9% from a year earlier.
• The company raised its dividend and continues buybacks, increasing its quarterly dividend to $1.19 per share and maintaining a $1 billion share repurchase authorization. Despite that, analysts still hold a cautious view, with a consensus rating of “Reduce.”

Conning Inc. lowered its stake in Paychex, Inc. (NASDAQ:PAYX - Free Report) by 96.3% during the fourth quarter, according to the company in its most recent filing with the Securities & Exchange Commission. The firm owned 9,092 shares of the business services provider's stock after selling 235,004 shares during the quarter. Conning Inc.'s holdings in Paychex were worth $1,020,000 at the end of the most recent reporting period.

Several other hedge funds and other institutional investors have also made changes to their positions in the stock. New York Life Investment Management LLC boosted its holdings in Paychex by 6.9% during the fourth quarter. New York Life Investment Management LLC now owns 46,985 shares of the business services provider's stock worth $5,271,000 after buying an additional 3,016 shares during the last quarter. Cornerstone Wealth Management LLC increased its stake in shares of Paychex by 6.3% in the 4th quarter. Cornerstone Wealth Management LLC now owns 4,375 shares of the business services provider's stock valued at $491,000 after acquiring an additional 261 shares during the last quarter. E Fund Management Hong Kong Co. Ltd. raised its position in shares of Paychex by 338.7% in the 4th quarter. E Fund Management Hong Kong Co. Ltd. now owns 1,518 shares of the business services provider's stock valued at $156,000 after acquiring an additional 1,172 shares during the period. Rayburn West Financial Services LLC acquired a new stake in shares of Paychex in the 4th quarter valued at approximately $323,000. Finally, Atria Investments Inc boosted its stake in Paychex by 28.8% during the 4th quarter. Atria Investments Inc now owns 61,322 shares of the business services provider's stock worth $6,879,000 after acquiring an additional 13,708 shares during the last quarter. 83.47% of the stock is currently owned by institutional investors.

Analyst Ratings Changes

A number of research analysts recently issued reports on PAYX shares. Jefferies Financial Group decreased their price objective on shares of Paychex from $110.00 to $105.00 and set a "hold" rating for the company in a report on Thursday, March 26th. Argus raised shares of Paychex to a "strong-buy" rating in a research report on Friday, March 27th. Wells Fargo & Company decreased their price target on shares of Paychex from $116.00 to $95.00 and set an "underweight" rating for the company in a report on Thursday, March 26th. Guggenheim started coverage on shares of Paychex in a research report on Thursday, March 19th. They issued a "neutral" rating for the company. Finally, Cantor Fitzgerald upgraded Paychex to a "strong sell" rating in a report on Tuesday, January 27th. One research analyst has rated the stock with a Strong Buy rating, one has assigned a Buy rating, twelve have assigned a Hold rating and four have issued a Sell rating to the stock. According to MarketBeat.com, the stock currently has an average rating of "Reduce" and a consensus target price of $106.38.

Paychex Price Performance

NASDAQ PAYX opened at $91.54 on Friday. The business has a 50 day simple moving average of $92.23 and a 200 day simple moving average of $102.34. Paychex, Inc. has a 52-week low of $85.45 and a 52-week high of $161.24. The company has a debt-to-equity ratio of 1.13, a quick ratio of 1.26 and a current ratio of 1.26. The stock has a market cap of $32.80 billion, a price-to-earnings ratio of 20.16 and a beta of 0.84.

Paychex (NASDAQ:PAYX - Get Free Report) last posted its earnings results 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 return on equity of 48.52% and a net margin of 25.84%.The business had revenue of $1.81 billion during the quarter, compared to analysts' expectations of $1.78 billion. During the same period in the prior year, the business earned $1.49 EPS. Paychex's revenue for the quarter was up 19.9% compared to the same quarter last year. Analysts anticipate that Paychex, Inc. will post 5.5 earnings per share for the current fiscal year.

Paychex Increases Dividend

The firm also recently disclosed a quarterly dividend, which will be paid on Friday, May 29th. Stockholders of record on Wednesday, May 13th will be issued a $1.19 dividend. This represents a $4.76 dividend on an annualized basis and a dividend yield of 5.2%. This is a boost from Paychex's previous quarterly dividend of $1.08. The ex-dividend date is Wednesday, May 13th. Paychex's dividend payout ratio is 104.85%.

Paychex declared that its board has authorized a share repurchase plan 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 plans are usually an indication that the company's management believes its shares are undervalued.

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.

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