First Trust Advisors LP Sells 46,347 Shares of Paychex, Inc. $PAYX

Key Points

• First Trust Advisors LP trimmed its Paychex stake by 2.5%, selling 46,347 shares and ending the quarter with 1,813,131 shares (about 0.50% ownership) worth roughly $229.8 million.
• Paychex beat quarterly estimates (EPS $1.26 vs. $1.23) with revenue up 18.3%, set FY2026 guidance of $5.48–$5.53, and announced a $1.00 billion share buyback while paying a $4.32 annual dividend (4.3% yield) with a ~98% payout ratio.

First Trust Advisors LP decreased its stake in shares of Paychex, Inc. (NASDAQ:PAYX - Free Report) by 2.5% in the third quarter, according to the company in its most recent Form 13F filing with the SEC. The fund owned 1,813,131 shares of the business services provider's stock after selling 46,347 shares during the quarter. First Trust Advisors LP owned about 0.50% of Paychex worth $229,833,000 at the end of the most recent quarter.

Several other institutional investors also recently bought and sold shares of PAYX. ABC Arbitrage SA lifted its position in Paychex by 61.4% during the third quarter. ABC Arbitrage SA now owns 28,208 shares of the business services provider's stock valued at $3,576,000 after purchasing an additional 10,726 shares during the last quarter. GSA Capital Partners LLP bought a new stake in shares of Paychex in the 3rd quarter worth about $1,877,000. Summit Global Investments raised its position in shares of Paychex by 1,938.2% during the 3rd quarter. Summit Global Investments now owns 48,143 shares of the business services provider's stock valued at $6,103,000 after buying an additional 45,781 shares in the last quarter. Alps Advisors Inc. raised its position in shares of Paychex by 20.6% during the 3rd quarter. Alps Advisors Inc. now owns 240,564 shares of the business services provider's stock valued at $30,494,000 after buying an additional 41,114 shares in the last quarter. Finally, Invesco Ltd. lifted its holdings in shares of Paychex by 6.0% in the 2nd quarter. Invesco Ltd. now owns 4,384,846 shares of the business services provider's stock valued at $637,820,000 after acquiring an additional 249,550 shares during the last quarter. 83.47% of the stock is owned by hedge funds and other institutional investors.

Paychex Stock Up 2.5%

NASDAQ:PAYX opened at $100.85 on Friday. The company has a debt-to-equity ratio of 1.17, a current ratio of 1.27 and a quick ratio of 1.27. Paychex, Inc. has a 1-year low of $86.89 and a 1-year high of $161.24. The company has a 50-day moving average of $102.25 and a 200 day moving average of $115.48. The firm has a market cap of $36.20 billion, a PE ratio of 22.87 and a beta of 0.91.

Paychex (NASDAQ:PAYX - Get Free Report) last posted its earnings results on Friday, December 19th. The business services provider reported $1.26 EPS for the quarter, beating analysts' consensus estimates of $1.23 by $0.03. Paychex had a net margin of 26.45% and a return on equity of 46.38%. The business had revenue of $1.56 billion for the quarter, compared to the consensus estimate of $1.55 billion. During the same quarter last year, the firm posted $1.14 EPS. The company's revenue for the quarter was up 18.3% on a year-over-year basis. Paychex has set its FY 2026 guidance at 5.480-5.530 EPS. As a group, research analysts anticipate that Paychex, Inc. will post 4.99 EPS for the current fiscal year.

Paychex Dividend Announcement

The firm also recently disclosed a quarterly dividend, which was paid on Friday, February 27th. Investors of record on Wednesday, January 28th were issued a dividend of $1.08 per share. This represents a $4.32 annualized dividend and a yield of 4.3%. The ex-dividend date of this dividend was Wednesday, January 28th. Paychex's dividend payout ratio (DPR) is presently 97.96%.

Paychex announced that its Board of Directors has initiated a stock repurchase plan on Friday, January 16th that authorizes the company to buyback $1.00 billion in outstanding shares. This buyback authorization authorizes the business services provider to reacquire up to 2.5% of its shares through open market purchases. Shares buyback plans are often a sign that the company's management believes its shares are undervalued.

Wall Street Analysts Forecast Growth

Several research analysts recently commented on the company. Cantor Fitzgerald upgraded Paychex to a "strong sell" rating in a research report on Tuesday, January 27th. Stephens lowered their price objective on Paychex from $135.00 to $125.00 and set an "equal weight" rating for the company in a research note on Monday, December 22nd. Morgan Stanley dropped their target price on Paychex from $133.00 to $123.00 and set an "equal weight" rating for the company in a report on Monday, December 22nd. Weiss Ratings reissued a "hold (c)" rating on shares of Paychex in a research report on Monday, December 29th. Finally, Royal Bank Of Canada decreased their price target on Paychex from $150.00 to $125.00 and set a "sector perform" rating on the stock in a report on Friday, December 5th. One research analyst has rated the stock with a Buy rating, thirteen have assigned a Hold rating and four have issued a Sell rating to the company's stock. According to data from MarketBeat.com, Paychex has a consensus rating of "Reduce" and an average price target of $123.94.

Paychex 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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