Paychex, Inc. $PAYX Shares Sold by GRIMES & Co WEALTH MANAGEMENT LLC

Key Points

• GRIMES & Co WEALTH MANAGEMENT cut its Paychex stake by 13.3% in Q4, selling 14,788 shares and leaving 96,506 shares valued at about $10.83 million.
• Paychex approved a $1.0 billion share buyback (up to ~2.5% of shares) and raised its quarterly dividend to $1.19 (annualized $4.76, ~5.0% yield).
• The company beat Q1 estimates with $1.71 EPS and $1.81B revenue (up 19.9% YoY), but analyst sentiment is mixed—MarketBeat shows a consensus rating of “Reduce” with a $106.38 target.

GRIMES & Co WEALTH MANAGEMENT LLC lessened its holdings in shares of Paychex, Inc. (NASDAQ:PAYX - Free Report) by 13.3% in the 4th quarter, according to the company in its most recent Form 13F filing with the Securities and Exchange Commission (SEC). The fund owned 96,506 shares of the business services provider's stock after selling 14,788 shares during the period. GRIMES & Co WEALTH MANAGEMENT LLC's holdings in Paychex were worth $10,826,000 as of its most recent filing with the Securities and Exchange Commission (SEC).

Other institutional investors have also recently made changes to their positions in the company. ABC Arbitrage SA increased its stake in shares of Paychex by 61.4% during the third quarter. ABC Arbitrage SA now owns 28,208 shares of the business services provider's stock worth $3,576,000 after purchasing an additional 10,726 shares in the last quarter. GSA Capital Partners LLP purchased a new stake in shares of Paychex during the third quarter worth about $1,877,000. Alps Advisors Inc. increased its stake in shares of Paychex by 20.6% during the third quarter. Alps Advisors Inc. now owns 240,564 shares of the business services provider's stock worth $30,494,000 after purchasing an additional 41,114 shares in the last quarter. Summit Global Investments increased its stake in shares of Paychex by 1,938.2% during the third quarter. Summit Global Investments now owns 48,143 shares of the business services provider's stock worth $6,103,000 after purchasing an additional 45,781 shares in the last quarter. Finally, First Long Island Investors LLC increased its stake in shares of Paychex by 23.9% during the third quarter. First Long Island Investors LLC now owns 99,607 shares of the business services provider's stock worth $12,626,000 after purchasing an additional 19,185 shares in the last quarter. Hedge funds and other institutional investors own 83.47% of the company's stock.

Paychex Stock Performance

Shares of PAYX stock opened at $94.26 on Friday. 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 debt-to-equity ratio of 1.13, a quick ratio of 1.26 and a current ratio of 1.26. Paychex, Inc. has a one year low of $85.45 and a one year high of $161.24. The firm has a market cap of $33.77 billion, a P/E ratio of 20.76 and a beta of 0.84.

Paychex (NASDAQ:PAYX - Get Free Report) last issued its quarterly earnings data on Wednesday, March 25th. The business services provider reported $1.71 EPS for the quarter, topping the consensus estimate 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 analyst estimates of $1.78 billion. During the same period in the prior year, the business posted $1.49 EPS. The business's revenue for the quarter was up 19.9% compared to the same quarter last year. As a group, equities research analysts predict that Paychex, Inc. will post 5.5 EPS for the current year.

Paychex declared that its Board of Directors has approved a stock repurchase program on Friday, January 16th that authorizes the company to repurchase $1.00 billion in outstanding shares. This repurchase authorization authorizes the business services provider to repurchase up to 2.5% of its stock through open market purchases. Stock repurchase programs are often an indication that the company's board believes its stock is undervalued.

Paychex Increases Dividend

The business 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. The ex-dividend date is Wednesday, May 13th. This represents a $4.76 annualized dividend and a dividend yield of 5.0%. This is an increase from Paychex's previous quarterly dividend of $1.08. Paychex's dividend payout ratio (DPR) is currently 95.15%.

Analyst Upgrades and Downgrades

PAYX has been the subject of a number of research reports. Wells Fargo & Company cut their target price on shares of Paychex from $116.00 to $95.00 and set an "underweight" rating for the company in a research note on Thursday, March 26th. Argus raised shares of Paychex to a "strong-buy" rating in a research note on Friday, March 27th. Weiss Ratings restated a "hold (c-)" rating on shares of Paychex in a research report on Friday, April 24th. TD Cowen lowered their price target on shares of Paychex from $95.00 to $94.00 and set a "hold" rating on the stock in a research report on Tuesday, April 7th. Finally, Morgan Stanley lowered their price target on shares of Paychex from $123.00 to $107.00 and set an "equal weight" rating on the stock in a research report on Tuesday, April 28th. One research analyst has rated the stock with a Strong Buy rating, one has issued a Buy rating, twelve have issued a Hold rating and four have assigned a Sell rating to the company. According to data from MarketBeat, the stock presently has a consensus rating of "Reduce" and a consensus target price of $106.38.

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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