Paychex, Inc. (NASDAQ:PAYX) Receives Average Rating of "Reduce" from Analysts

Key Points

• Paychex, Inc. has received an average rating of "Reduce" from analysts, with one sell recommendation and ten hold ratings among the eleven brokerages covering the company.
• The average 12-month price target for Paychex is $149.70, indicating a moderate outlook from analysts.
• Paychex recently announced a quarterly dividend of $1.08 per share, representing a yield of 3.1% and a payout ratio of 94.53%.

Paychex, Inc. (NASDAQ:PAYX - Get Free Report) has earned an average recommendation of "Reduce" from the eleven brokerages that are currently covering the company, MarketBeat.com reports. One research analyst has rated the stock with a sell recommendation and ten have assigned a hold recommendation to the company. The average 12-month price target among analysts that have updated their coverage on the stock in the last year is $149.70.

A number of equities research analysts recently weighed in on the stock. Royal Bank Of Canada set a $165.00 target price on shares of Paychex and gave the company a "sector perform" rating in a research note on Tuesday, June 24th. BMO Capital Markets began coverage on shares of Paychex in a research note on Thursday, July 10th. They set a "market perform" rating and a $160.00 target price on the stock. Jefferies Financial Group set a $140.00 target price on shares of Paychex and gave the stock a "hold" rating in a report on Thursday, June 26th. UBS Group lowered their target price on Paychex from $155.00 to $145.00 and set a "neutral" rating for the company in a research report on Thursday, June 26th. Finally, JPMorgan Chase & Co. raised their price target on Paychex from $148.00 to $153.00 and gave the stock an "underweight" rating in a research report on Thursday, August 14th.

Paychex Price Performance

NASDAQ PAYX opened at $138.04 on Wednesday. The company has a market cap of $49.73 billion, a PE ratio of 30.21, a price-to-earnings-growth ratio of 3.17 and a beta of 0.91. Paychex has a 52 week low of $128.92 and a 52 week high of $161.24. The company has a quick ratio of 1.28, a current ratio of 1.28 and a debt-to-equity ratio of 1.10. The firm's 50-day simple moving average is $143.13 and its two-hundred day simple moving average is $147.62.

Paychex (NASDAQ:PAYX - Get Free Report) last released its quarterly earnings data on Wednesday, June 25th. The business services provider reported $1.19 EPS for the quarter, meeting the consensus estimate of $1.19. Paychex had a net margin of 29.75% and a return on equity of 45.01%. The business had revenue of $1.43 billion for the quarter, compared to the consensus estimate of $1.38 billion. During the same period in the prior year, the firm earned $1.12 earnings per share. Paychex has set its FY 2026 guidance at EPS. Research analysts predict that Paychex will post 4.99 earnings per share for the current year.

Paychex Announces Dividend

The business also recently announced a quarterly dividend, which will be paid on Friday, August 29th. Shareholders of record on Monday, July 21st will be paid a $1.08 dividend. This represents a $4.32 annualized dividend and a yield of 3.1%. The ex-dividend date is Monday, July 21st. Paychex's payout ratio is 94.53%.

Insider Activity

In related news, CEO John B. Gibson sold 12,370 shares of Paychex stock in a transaction that occurred on Wednesday, July 16th. The stock was sold at an average price of $141.92, for a total transaction of $1,755,550.40. Following the completion of the transaction, the chief executive officer directly owned 81,755 shares in the company, valued at approximately $11,602,669.60. This trade represents a 13.14% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, Chairman Martin Mucci sold 97,526 shares of Paychex stock in a transaction that occurred on Thursday, July 10th. The shares were sold at an average price of $145.17, for a total value of $14,157,849.42. Following the transaction, the chairman owned 446,917 shares of the company's stock, valued at approximately $64,878,940.89. This represents a 17.91% decrease in their ownership of the stock. The disclosure for this sale can be found here. 11.40% of the stock is currently owned by company insiders.

Institutional Trading of Paychex

Several large investors have recently made changes to their positions in the company. Thrivent Financial for Lutherans increased its position in shares of Paychex by 32.8% during the second quarter. Thrivent Financial for Lutherans now owns 28,251 shares of the business services provider's stock worth $4,095,000 after purchasing an additional 6,971 shares in the last quarter. MASTERINVEST Kapitalanlage GmbH acquired a new position in Paychex during the 2nd quarter worth about $205,000. North Dallas Bank & Trust Co. purchased a new stake in Paychex during the 2nd quarter worth about $951,000. B. Riley Wealth Advisors Inc. purchased a new stake in Paychex during the 2nd quarter worth about $887,000. Finally, Geneos Wealth Management Inc. increased its holdings in shares of Paychex by 106.4% in the 2nd quarter. Geneos Wealth Management Inc. now owns 5,807 shares of the business services provider's stock valued at $845,000 after acquiring an additional 2,994 shares during the last quarter. 83.47% of the stock is currently owned by hedge funds and other institutional investors.

About Paychex

Paychex, Inc, together with its subsidiaries, provides integrated human capital management solutions (HCM) for payroll, benefits, human resources (HR), and insurance services for small to medium-sized businesses in the United States, Europe, and India. It offers payroll processing services; payroll tax administration services; employee payment services; and regulatory compliance services, such as new-hire reporting and garnishment processing.

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