Raleigh Capital Management Inc. Purchases 11,394 Shares of Paychex, Inc. $PAYX

Key Points

• Raleigh Capital Management dramatically increased its Paychex stake by 71,212.5%, buying an additional 11,394 shares to hold 11,410 shares worth about $1.28 million at quarter end.
• Paychex recently paid a quarterly dividend of $1.08 (annualized $4.32) for a ~4.7% yield and a high payout ratio of 95.15%, and its board approved a $1.0 billion share buyback program (≈2.5% of shares).
• The company beat recent quarterly estimates with $1.71 EPS and revenue up 19.9% year-over-year, but analyst sentiment is mixed with a MarketBeat consensus of "Reduce" and an average price target of $108.81.

Raleigh Capital Management Inc. increased its position in Paychex, Inc. (NASDAQ:PAYX - Free Report) by 71,212.5% in the 4th quarter, according to the company in its most recent disclosure with the Securities and Exchange Commission (SEC). The firm owned 11,410 shares of the business services provider's stock after purchasing an additional 11,394 shares during the quarter. Raleigh Capital Management Inc.'s holdings in Paychex were worth $1,280,000 at the end of the most recent quarter.

Other hedge funds and other institutional investors also recently made changes to their positions in the company. ABC Arbitrage SA lifted its holdings 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 valued at $3,576,000 after acquiring an additional 10,726 shares during the period. GSA Capital Partners LLP bought a new position in shares of Paychex during the third quarter valued at $1,877,000. Alps Advisors Inc. lifted its holdings 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 valued at $30,494,000 after acquiring an additional 41,114 shares during the period. Summit Global Investments lifted its holdings 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 valued at $6,103,000 after acquiring an additional 45,781 shares during the period. Finally, First Long Island Investors LLC lifted its holdings 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 valued at $12,626,000 after acquiring an additional 19,185 shares during the period. 83.47% of the stock is owned by institutional investors.

Paychex Price Performance

Shares of PAYX stock opened at $91.85 on Tuesday. The stock has a 50-day moving average price of $94.76 and a 200 day moving average price of $108.90. The company has a quick ratio of 1.26, a current ratio of 1.26 and a debt-to-equity ratio of 1.13. The firm has a market cap of $32.91 billion, a price-to-earnings ratio of 20.23 and a beta of 0.88. Paychex, Inc. has a 12 month low of $86.89 and a 12 month high of $161.24.

Paychex (NASDAQ:PAYX - Get Free Report) last announced its quarterly earnings data on Wednesday, March 25th. The business services provider reported $1.71 EPS for the quarter, topping analysts' consensus estimates of $1.67 by $0.04. The firm had revenue of $1.81 billion during the quarter, compared to analyst estimates of $1.78 billion. Paychex had a return on equity of 48.52% and a net margin of 25.84%.The company's revenue was up 19.9% on a year-over-year basis. During the same period last year, the company earned $1.49 earnings per share. Research analysts expect that Paychex, Inc. will post 4.99 EPS for the current year.

Paychex Announces Dividend

The company also recently disclosed a quarterly dividend, which was paid on Friday, February 27th. Investors of record on Wednesday, January 28th were given a $1.08 dividend. This represents a $4.32 dividend on an annualized basis and a yield of 4.7%. The ex-dividend date was Wednesday, January 28th. Paychex's dividend payout ratio (DPR) is presently 95.15%.

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

Wall Street Analysts Forecast Growth

A number of research analysts have issued reports on the company. Cantor Fitzgerald raised Paychex to a "strong sell" rating in a report on Tuesday, January 27th. Weiss Ratings reaffirmed a "hold (c)" rating on shares of Paychex in a report on Monday, December 29th. Argus raised Paychex to a "strong-buy" rating in a report on Friday, March 27th. Guggenheim initiated coverage on Paychex in a report on Thursday, March 19th. They issued a "neutral" rating for the company. Finally, Citigroup cut their price target on Paychex from $120.00 to $99.00 and set a "neutral" rating for the company in a report on Thursday, March 26th. One research analyst has rated the stock with a Strong Buy rating, one has issued a Buy rating, twelve have assigned a Hold rating and four have issued a Sell rating to the company's stock. According to MarketBeat, the stock has a consensus rating of "Reduce" and an average price target of $108.81.

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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