GAMMA Investing LLC Has $2.76 Million Holdings in Paychex, Inc. $PAYX

Key Points

• GAMMA Investing LLC increased its Paychex holdings by 91.2% in the second quarter, bringing its position to 28,090 shares valued at approximately $2.76 million. Institutional investors collectively own 83.47% of the company.
• Paychex exceeded quarterly expectations with earnings of $1.32 per share and revenue of $1.61 billion, up 12.5% year over year. The company also declared a quarterly dividend of $1.19 per share, representing a 4.0% annualized yield.
• Analyst sentiment remains cautious, with a consensus rating of “Hold” and an average price target of $108.20, below the stock’s reported $118.27 price. Company insiders recently sold shares, while insider ownership stands at 0.80%.

GAMMA Investing LLC raised its holdings in Paychex, Inc. (NASDAQ:PAYX - Free Report) by 91.2% during the second quarter, according to the company in its most recent Form 13F filing with the Securities & Exchange Commission. The fund owned 28,090 shares of the business services provider's stock after acquiring an additional 13,399 shares during the period. GAMMA Investing LLC's holdings in Paychex were worth $2,762,000 at the end of the most recent quarter.

A number of other institutional investors and hedge funds have also recently made changes to their positions in the stock. Vanguard Group Inc. increased its position 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 worth $4,750,669,000 after purchasing an additional 4,583,157 shares in the last quarter. Capital International Investors grew its position in Paychex by 59.1% during the 4th 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 last quarter. State Street Corp grew its position in Paychex by 1.6% during the 4th quarter. State Street Corp now owns 13,988,393 shares of the business services provider's stock worth $1,569,218,000 after acquiring an additional 216,045 shares during the last quarter. Charles Schwab Investment Management Inc. increased its holdings in Paychex by 2.3% in the 4th quarter. Charles Schwab Investment Management Inc. now owns 11,550,173 shares of the business services provider's stock worth $1,295,698,000 after purchasing an additional 263,152 shares in the last quarter. Finally, Geode Capital Management LLC increased its stake in shares of Paychex by 0.8% in the fourth quarter. Geode Capital Management LLC now owns 9,705,424 shares of the business services provider's stock valued at $1,093,958,000 after buying an additional 78,760 shares during the period. Institutional investors own 83.47% of the company's stock.

Paychex Trading Down 0.3%

Shares of Paychex stock opened at $118.27 on Thursday. The stock has a market capitalization of $42.07 billion, a PE ratio of 24.19 and a beta of 0.81. Paychex, Inc. has a 52 week low of $85.45 and a 52 week high of $141.89. The stock has a 50 day moving average price of $105.79 and a two-hundred day moving average price of $98.68. The company has a debt-to-equity ratio of 1.22, a quick ratio of 1.26 and a current ratio of 1.26.

Paychex (NASDAQ:PAYX - Get Free Report) last issued its earnings results on Wednesday, June 24th. The business services provider reported $1.32 earnings per share for the quarter, topping analysts' consensus estimates of $1.31 by $0.01. Paychex had a return on equity of 50.90% and a net margin of 27.03%.The company had revenue of $1.61 billion for the quarter, compared to analyst estimates of $1.60 billion. During the same period in the prior year, the firm earned $1.19 earnings per share. Paychex's revenue for the quarter was up 12.5% on a year-over-year basis. Paychex has set its FY 2027 guidance at 5.900-6.010 EPS. As a group, equities analysts anticipate that Paychex, Inc. will post 5.96 earnings per share for the current fiscal year.

Paychex Announces Dividend

The firm also recently disclosed a quarterly dividend, which will be paid on Friday, August 28th. Shareholders of record on Tuesday, July 28th will be issued a dividend of $1.19 per share. The ex-dividend date is Tuesday, July 28th. This represents a $4.76 annualized dividend and a yield of 4.0%. Paychex's dividend payout ratio is presently 97.34%.

Wall Street Analyst Weigh In

A number of equities research analysts have weighed in on PAYX shares. Cantor Fitzgerald reissued an "underweight" rating and set a $107.00 target price on shares of Paychex in a report on Monday, July 20th. Royal Bank Of Canada reiterated a "sector perform" rating on shares of Paychex in a report on Thursday, May 28th. Weiss Ratings raised shares of Paychex from a "hold (c-)" rating to a "hold (c)" rating in a research note on Monday, July 20th. TD Cowen increased their price target on Paychex from $94.00 to $98.00 and gave the company a "hold" rating in a research note on Monday, June 8th. Finally, JPMorgan Chase & Co. increased their price objective on shares of Paychex from $100.00 to $105.00 and gave the stock an "underweight" rating in a research report on Thursday, June 25th. One equities research analyst has rated the stock with a Strong Buy rating, two have issued a Buy rating, ten have given a Hold rating and four have given a Sell rating to the stock. According to MarketBeat.com, the company currently has an average rating of "Hold" and a consensus target price of $108.20.

Insiders Place Their Bets

In other news, CFO Robert L. Schrader sold 2,600 shares of the business's stock in a transaction dated Monday, July 20th. The shares were sold at an average price of $115.09, for a total transaction of $299,234.00. Following the completion of the sale, the chief financial officer directly owned 18,547 shares of the company's stock, valued at $2,134,574.23. The trade was a 12.29% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available at this link. Also, Director Joseph M. Tucci sold 3,907 shares of the company's stock in a transaction dated Friday, June 26th. The stock was sold at an average price of $98.25, for a total transaction of $383,862.75. Following the completion of the sale, the director owned 67,364 shares in the company, valued at $6,618,513. This represents a 5.48% decrease in their position. The disclosure for this sale is available in the SEC filing. 0.80% of the stock is currently owned by company insiders.

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.

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