Prevatt Capital Ltd Acquires Shares of 245,000 Paychex, Inc. $PAYX

Key Points

• Prevatt Capital Ltd disclosed a new stake in Paychex, buying 245,000 shares worth about $22.6 million in the first quarter. The position now makes up roughly 6.1% of its portfolio.
• Paychex reported better-than-expected quarterly results, with EPS of $1.32 versus $1.31 expected and revenue of $1.61 billion versus $1.60 billion expected. Revenue rose 12.5% year over year.
• The company also raised its quarterly dividend to $1.19 per share, implying a 4.5% annualized yield. Meanwhile, analysts currently have a consensus Hold rating and an average price target of $105.80.

Prevatt Capital Ltd acquired a new stake in Paychex, Inc. (NASDAQ:PAYX - Free Report) during the 1st quarter, according to its most recent disclosure with the Securities and Exchange Commission. The institutional investor acquired 245,000 shares of the business services provider's stock, valued at approximately $22,569,000. Paychex comprises about 6.1% of Prevatt Capital Ltd's portfolio, making the stock its 8th largest position. Prevatt Capital Ltd owned about 0.07% of Paychex at the end of the most recent quarter.

Other hedge funds and other institutional investors have also recently made changes to their positions in the company. Private Advisor Group LLC raised its holdings in shares of Paychex by 5.2% during the first quarter. Private Advisor Group LLC now owns 31,917 shares of the business services provider's stock worth $2,940,000 after purchasing an additional 1,581 shares during the last quarter. Optas LLC boosted its holdings in Paychex by 81.8% in the first quarter. Optas LLC now owns 4,490 shares of the business services provider's stock valued at $414,000 after purchasing an additional 2,020 shares during the last quarter. Leonteq Securities AG boosted its holdings in Paychex by 2,669.2% in the first quarter. Leonteq Securities AG now owns 360 shares of the business services provider's stock valued at $33,000 after purchasing an additional 347 shares during the last quarter. Fjarde AP Fonden Fourth Swedish National Pension Fund grew its position in Paychex by 65.7% during the 1st quarter. Fjarde AP Fonden Fourth Swedish National Pension Fund now owns 140,945 shares of the business services provider's stock worth $12,984,000 after purchasing an additional 55,900 shares during the period. Finally, Elevation Point Wealth Partners LLC acquired a new stake in Paychex during the 1st quarter worth about $360,000. Institutional investors and hedge funds own 83.47% of the company's stock.

Insider Transactions at Paychex

In other Paychex news, Director Joseph M. Tucci sold 3,907 shares of the firm's stock in a transaction that occurred on Friday, June 26th. The stock was sold at an average price of $98.25, for a total value of $383,862.75. Following the sale, the director directly owned 67,364 shares of the company's stock, valued at approximately $6,618,513. This trade represents a 5.48% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this hyperlink. Corporate insiders own 0.80% of the company's stock.

Wall Street Analyst Weigh In

PAYX has been the subject of several analyst reports. Guggenheim initiated coverage on Paychex in a report on Thursday, March 19th. They issued a "neutral" rating for the company. Royal Bank Of Canada reaffirmed a "sector perform" rating on shares of Paychex in a report on Thursday, May 28th. BMO Capital Markets lifted their price target on Paychex to $52.00 and gave the company an "outperform" rating in a research report on Thursday, March 26th. Wells Fargo & Company decreased their price target on Paychex from $116.00 to $95.00 and set an "underweight" rating for the company in a report on Thursday, March 26th. Finally, TD Cowen upped their price objective on Paychex from $94.00 to $98.00 and gave the stock a "hold" rating in a research report on Monday, June 8th. One analyst has rated the stock with a Strong Buy rating, two have assigned a Buy rating, ten have assigned a Hold rating and four have issued a Sell rating to the company's stock. Based on data from MarketBeat, Paychex presently has an average rating of "Hold" and a consensus price target of $105.80.

Paychex Trading Up 3.5%

Shares of Paychex stock opened at $106.35 on Friday. The firm has a 50-day simple moving average of $96.34 and a two-hundred day simple moving average of $98.71. The company has a market cap of $38.10 billion, a P/E ratio of 21.75 and a beta of 0.84. Paychex, Inc. has a fifty-two week low of $85.45 and a fifty-two week high of $148.11. 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 posted its earnings results on Wednesday, June 24th. The business services provider reported $1.32 EPS for the quarter, beating 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 firm had revenue of $1.61 billion for the quarter, compared to analysts' expectations of $1.60 billion. During the same period last year, the firm earned $1.19 EPS. The company's quarterly revenue 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 predict that Paychex, Inc. will post 5.97 earnings per share for the current fiscal year.

Paychex Increases Dividend

The firm also recently declared a quarterly dividend, which was paid on Friday, May 29th. Shareholders of record on Wednesday, May 13th were given a dividend of $1.19 per share. This is an increase from Paychex's previous quarterly dividend of $1.08. This represents a $4.76 dividend on an annualized basis and a yield of 4.5%. The ex-dividend date was Wednesday, May 13th. Paychex's dividend payout ratio (DPR) is currently 97.34%.

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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