Paychex (NASDAQ:PAYX) Reaches New 12-Month Low After Analyst Downgrade

Key Points

• Paychex's stock price reached a new 52-week low at $128.23 following a downgrade from Stifel Nicolaus, which lowered its price target from $152.00 to $142.00.
• Multiple analysts have adjusted their targets for Paychex, with an average target price of $148.20 and a consensus rating of "Reduce."
• The company announced a quarterly dividend of $1.08 per share, reflecting a 3.3% yield, despite a high dividend payout ratio of 94.53%.

Paychex, Inc. (NASDAQ:PAYX - Get Free Report) reached a new 52-week low during trading on Monday after Stifel Nicolaus lowered their price target on the stock from $152.00 to $142.00. Stifel Nicolaus currently has a hold rating on the stock. Paychex traded as low as $128.23 and last traded at $130.01, with a volume of 64836 shares trading hands. The stock had previously closed at $130.00.

A number of other analysts have also recently weighed in on the stock. Royal Bank Of Canada set a $165.00 target price on shares of Paychex and gave the stock a "sector perform" rating in a report on Tuesday, June 24th. Citigroup decreased their price objective on shares of Paychex from $158.00 to $148.00 and set a "neutral" rating for the company in a research note on Thursday, August 21st. JPMorgan Chase & Co. raised their price objective on shares of Paychex from $148.00 to $153.00 and gave the stock an "underweight" rating in a research note on Thursday, August 14th. BMO Capital Markets began coverage on shares of Paychex in a research note on Thursday, July 10th. They issued a "market perform" rating and a $160.00 price objective for the company. Finally, UBS Group decreased their price objective on shares of Paychex from $148.00 to $140.00 and set a "neutral" rating for the company in a research note on Wednesday, September 17th. Ten research analysts have rated the stock with a Hold rating and one has issued a Sell rating to the company. According to MarketBeat.com, the stock currently has a consensus rating of "Reduce" and a consensus price target of $148.20.

Insider Buying and Selling

In other news, Chairman Martin Mucci sold 97,526 shares of the firm's stock in a transaction on Thursday, July 10th. The shares were sold at an average price of $145.17, for a total transaction of $14,157,849.42. Following the transaction, the chairman owned 446,917 shares in the company, valued at approximately $64,878,940.89. This trade represents a 17.91% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this link. Also, CEO John B. Gibson sold 12,370 shares of the firm's stock in a transaction on Wednesday, July 16th. The shares were sold at an average price of $141.92, for a total transaction of $1,755,550.40. Following the transaction, the chief executive officer owned 81,755 shares in the company, valued at $11,602,669.60. This represents a 13.14% decrease in their position. The disclosure for this sale can be found here. 0.80% of the stock is owned by corporate insiders.

Institutional Inflows and Outflows

Hedge funds and other institutional investors have recently modified their holdings of the business. NewSquare Capital LLC raised its holdings in shares of Paychex by 83.8% during the 2nd quarter. NewSquare Capital LLC now owns 215 shares of the business services provider's stock valued at $31,000 after purchasing an additional 98 shares in the last quarter. MorganRosel Wealth Management LLC bought a new position in shares of Paychex during the 1st quarter valued at $34,000. Quarry LP bought a new position in shares of Paychex during the 1st quarter valued at $34,000. Alpine Bank Wealth Management bought a new position in Paychex in the 1st quarter worth $34,000. Finally, Tsfg LLC raised its holdings in Paychex by 122.3% in the 1st quarter. Tsfg LLC now owns 229 shares of the business services provider's stock worth $35,000 after acquiring an additional 126 shares during the period. Institutional investors own 83.47% of the company's stock.

Paychex Stock Up 0.3%

The stock has a market cap of $46.89 billion, a P/E ratio of 28.53, a P/E/G ratio of 2.98 and a beta of 0.91. The company has a current ratio of 1.28, a quick ratio of 1.28 and a debt-to-equity ratio of 1.10. The firm's fifty day moving average is $138.80 and its 200 day moving average is $145.65.

Paychex (NASDAQ:PAYX - Get Free Report) last announced its earnings results on Wednesday, June 25th. The business services provider reported $1.19 EPS for the quarter, hitting the consensus estimate of $1.19. The firm had revenue of $1.43 billion for the quarter, compared to the consensus estimate of $1.38 billion. Paychex had a net margin of 29.75% and a return on equity of 45.01%. During the same quarter last year, the firm posted $1.12 EPS. Paychex has set its FY 2026 guidance at EPS. As a group, equities research analysts forecast that Paychex, Inc. will post 4.99 EPS for the current year.

Paychex Dividend Announcement

The company also recently announced a quarterly dividend, which was paid on Friday, August 29th. Investors of record on Monday, July 21st were issued a $1.08 dividend. This represents a $4.32 annualized dividend and a yield of 3.3%. The ex-dividend date was Monday, July 21st. Paychex's dividend payout ratio (DPR) is 94.53%.

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.