Paychex (NASDAQ:PAYX) Price Target Lowered to $107.00 at Morgan Stanley

Key Points

• Morgan Stanley cut its price target on Paychex from $123 to $107 and maintained an "equal weight" rating, implying roughly a 15.4% upside from the current price.
• Several other firms have also trimmed targets, leaving analysts' consensus at a "Reduce" rating with an average price target of $106.38.
• Paychex beat quarterly estimates (EPS $1.71 vs. $1.67) with revenue up 19.9% year-over-year, and its board approved a $1.00 billion share repurchase program (~2.5% of shares).

Paychex (NASDAQ:PAYX - Get Free Report) had its target price dropped by equities researchers at Morgan Stanley from $123.00 to $107.00 in a research note issued to investors on Tuesday,MarketScreener reports. The brokerage currently has an "equal weight" rating on the business services provider's stock. Morgan Stanley's target price would indicate a potential upside of 15.40% from the company's current price.

PAYX has been the topic of several other research reports. JPMorgan Chase & Co. lowered their price target on shares of Paychex from $125.00 to $100.00 and set an "underweight" rating on the stock in a report on Thursday, March 26th. Guggenheim began coverage on shares of Paychex in a research report on Thursday, March 19th. They set a "neutral" rating on the stock. TD Cowen lowered their target price on shares of Paychex from $95.00 to $94.00 and set a "hold" rating on the stock in a research note on Tuesday, April 7th. Jefferies Financial Group dropped their target price on shares of Paychex from $110.00 to $105.00 and set a "hold" rating for the company in a report on Thursday, March 26th. Finally, UBS Group decreased their price target on Paychex from $98.00 to $94.00 and set a "neutral" rating on the stock in a report on Monday, April 13th. One research analyst has rated the stock with a Strong Buy rating, one has assigned a Buy rating, twelve have given a Hold rating and four have assigned a Sell rating to the company's stock. According to MarketBeat, the stock currently has a consensus rating of "Reduce" and an average price target of $106.38.

Paychex Stock Up 1.9%

PAYX opened at $92.72 on Tuesday. The firm's 50 day simple moving average is $92.27 and its two-hundred day simple moving average is $104.82. The company has a market capitalization of $33.22 billion, a PE ratio of 20.49 and a beta of 0.88. Paychex has a 1-year low of $85.45 and a 1-year high of $161.24. The company has a current ratio of 1.26, a quick ratio of 1.26 and a debt-to-equity ratio of 1.13.

Paychex (NASDAQ:PAYX - Get Free Report) last issued its quarterly earnings data on Wednesday, March 25th. The business services provider reported $1.71 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $1.67 by $0.04. The firm had revenue of $1.81 billion during the quarter, compared to the consensus estimate of $1.78 billion. Paychex had a net margin of 25.84% and a return on equity of 48.52%. The company's revenue for the quarter was up 19.9% compared to the same quarter last year. During the same quarter in the previous year, the firm posted $1.49 EPS. As a group, equities analysts forecast that Paychex will post 5.5 EPS for the current year.

Paychex declared that its board 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 buy up to 2.5% of its shares through open market purchases. Shares repurchase programs are typically a sign that the company's board believes its shares are undervalued.

Institutional Trading of Paychex

A number of institutional investors and hedge funds have recently bought and sold shares of PAYX. Suncoast Equity Management raised its stake in Paychex by 0.6% during the third quarter. Suncoast Equity Management now owns 14,055 shares of the business services provider's stock valued at $1,782,000 after purchasing an additional 85 shares in the last quarter. 44 Wealth Management LLC increased its holdings in shares of Paychex by 2.7% in the 2nd quarter. 44 Wealth Management LLC now owns 3,290 shares of the business services provider's stock worth $479,000 after buying an additional 86 shares during the last quarter. Simon Quick Advisors LLC increased its holdings in shares of Paychex by 1.5% in the 3rd quarter. Simon Quick Advisors LLC now owns 6,126 shares of the business services provider's stock worth $777,000 after buying an additional 89 shares during the last quarter. Smartleaf Asset Management LLC raised its position in shares of Paychex by 3.5% during the 2nd quarter. Smartleaf Asset Management LLC now owns 2,645 shares of the business services provider's stock valued at $381,000 after buying an additional 89 shares in the last quarter. Finally, JPL Wealth Management LLC lifted its holdings in shares of Paychex by 0.3% in the 3rd quarter. JPL Wealth Management LLC now owns 27,686 shares of the business services provider's stock valued at $3,509,000 after acquiring an additional 92 shares during the last quarter. 83.47% of the stock is currently owned by institutional investors.

Paychex Company Profile

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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