Paychex (NASDAQ:PAYX) Shares Gap Down Following Weak Earnings

Paychex, Inc. (NASDAQ:PAYX - Get Free Report)'s share price gapped down prior to trading on Wednesday following a weaker than expected earnings announcement. The stock had previously closed at $152.25, but opened at $145.27. Paychex shares last traded at $138.65, with a volume of 945,157 shares changing hands.

The business services provider reported $1.19 earnings per share for the quarter, missing analysts' consensus estimates of $1.20 by ($0.01). Paychex had a net margin of 31.99% and a return on equity of 45.30%. During the same quarter last year, the business posted $1.12 earnings per share.

Paychex Increases Dividend

The business also recently announced a quarterly dividend, which was paid on Thursday, May 29th. Stockholders of record on Monday, May 12th were given a $1.08 dividend. This is an increase from Paychex's previous quarterly dividend of $0.98. The ex-dividend date of this dividend was Monday, May 12th. This represents a $4.32 annualized dividend and a dividend yield of 3.11%. Paychex's dividend payout ratio is presently 90.00%.

Wall Street Analyst Weigh In

Several equities research analysts recently commented on PAYX shares. Royal Bank Of Canada set a $165.00 target price on Paychex and gave the company a "sector perform" rating in a report on Tuesday. Stifel Nicolaus lifted their price objective on shares of Paychex from $141.00 to $156.00 and gave the company a "hold" rating in a research note on Thursday, March 27th. UBS Group boosted their target price on shares of Paychex from $152.00 to $155.00 and gave the stock a "neutral" rating in a research report on Tuesday, March 4th. Cfra Research raised shares of Paychex to a "hold" rating in a report on Thursday, March 27th. Finally, Jefferies Financial Group reaffirmed a "hold" rating on shares of Paychex in a research note on Friday, May 23rd. Two investment analysts have rated the stock with a sell rating and ten have issued a hold rating to the company's stock. Based on data from MarketBeat, Paychex has a consensus rating of "Hold" and a consensus target price of $143.36.

Insider Activity

In other news, Director Joseph M. Velli sold 3,650 shares of the business's stock in a transaction on Tuesday, April 15th. The shares were sold at an average price of $149.25, for a total transaction of $544,762.50. Following the completion of the transaction, the director now owns 78,455 shares of the company's stock, valued at approximately $11,709,408.75. The trade was a 4.45% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the SEC, which can be accessed through the SEC website. Corporate insiders own 11.40% of the company's stock.

Institutional Inflows and Outflows

A number of hedge funds and other institutional investors have recently bought and sold shares of PAYX. Brighton Jones LLC raised its stake in Paychex by 26.3% during the 4th quarter. Brighton Jones LLC now owns 5,710 shares of the business services provider's stock valued at $801,000 after acquiring an additional 1,190 shares in the last quarter. Union Bancaire Privee UBP SA acquired a new stake in Paychex in the fourth quarter worth about $28,000. Colonial River Investments LLC bought a new position in Paychex in the 4th quarter valued at about $201,000. IFP Advisors Inc raised its position in shares of Paychex by 12.6% during the 4th quarter. IFP Advisors Inc now owns 6,365 shares of the business services provider's stock worth $898,000 after buying an additional 712 shares in the last quarter. Finally, BankPlus Trust Department acquired a new stake in shares of Paychex in the 4th quarter worth approximately $39,000. 83.47% of the stock is owned by institutional investors and hedge funds.

Paychex Stock Down 8.9%

The firm has a market capitalization of $49.97 billion, a P/E ratio of 28.90, a PEG ratio of 3.30 and a beta of 0.92. The firm's fifty day moving average price is $151.98 and its 200-day moving average price is $147.82. The company has a debt-to-equity ratio of 0.19, a current ratio of 1.39 and a quick ratio of 1.39.

Paychex Company Profile

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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