What is Zacks Research's Forecast for Paychex Q1 Earnings?

Key Points

• Zacks Research raised its Q1 2027 EPS estimate for Paychex to $1.33 from $1.31, signaling slightly better near-term earnings expectations.
• The firm also lifted several longer-term forecasts, including FY2027 to $5.92 EPS and FY2028 to $6.22 EPS, pointing to a more constructive profit outlook overall.
• Paychex’s latest quarterly results topped estimates, with EPS of $1.32 on revenue of $1.61 billion, while the company also raised its dividend to $1.19 per share quarterly.

Paychex, Inc. (NASDAQ:PAYX - Free Report) - Research analysts at Zacks Research increased their Q1 2027 EPS estimates for shares of Paychex in a report issued on Wednesday, July 8th. Zacks Research analyst Team now expects that the business services provider will post earnings per share of $1.33 for the quarter, up from their prior estimate of $1.31. The consensus estimate for Paychex's current full-year earnings is $5.97 per share. Zacks Research also issued estimates for Paychex's Q2 2027 earnings at $1.36 EPS, Q3 2027 earnings at $1.78 EPS, Q4 2027 earnings at $1.45 EPS, FY2027 earnings at $5.92 EPS, Q1 2028 earnings at $1.40 EPS, Q3 2028 earnings at $1.67 EPS, Q4 2028 earnings at $1.70 EPS, FY2028 earnings at $6.22 EPS and FY2029 earnings at $6.69 EPS.

Paychex (NASDAQ:PAYX - Get Free Report) last released its quarterly earnings results on Wednesday, June 24th. The business services provider reported $1.32 earnings per share for the quarter, topping analysts' consensus estimates of $1.31 by $0.01. Paychex had a return on equity of 50.90% and a net margin of 27.03%.The business had revenue of $1.61 billion for the quarter, compared to analysts' expectations of $1.60 billion. During the same quarter in the prior year, the firm posted $1.19 EPS. The company's revenue was up 12.5% compared to the same quarter last year. Paychex has set its FY 2027 guidance at 5.900-6.010 EPS.

A number of other research analysts have also recently weighed in on the company. Royal Bank Of Canada restated a "sector perform" rating on shares of Paychex in a research report on Thursday, May 28th. JPMorgan Chase & Co. upped their price objective on shares of Paychex from $100.00 to $105.00 and gave the company an "underweight" rating in a research note on Thursday, June 25th. Argus upgraded shares of Paychex to a "strong-buy" rating in a research report on Friday, March 27th. Wells Fargo & Company lowered their target price on shares of Paychex from $116.00 to $95.00 and set an "underweight" rating for the company in a research note on Thursday, March 26th. Finally, Citigroup upgraded Paychex from a "neutral" rating to a "buy" rating and boosted their price target for the company from $99.00 to $140.00 in a report on Monday, June 15th. One equities research analyst has rated the stock with a Strong Buy rating, two have issued a Buy rating, ten have issued a Hold rating and four have assigned a Sell rating to the company's stock. According to MarketBeat, Paychex currently has a consensus rating of "Hold" and an average price target of $105.80.

Paychex Stock Down 1.4%

PAYX opened at $106.58 on Thursday. The business's fifty day moving average is $97.59 and its two-hundred day moving average is $98.46. The company has a debt-to-equity ratio of 1.22, a quick ratio of 1.26 and a current ratio of 1.26. The company has a market cap of $38.19 billion, a price-to-earnings ratio of 21.80 and a beta of 0.84. Paychex has a one year low of $85.45 and a one year high of $148.11.

Paychex Increases Dividend

The company also recently disclosed a quarterly dividend, which was paid on Friday, May 29th. Stockholders of record on Wednesday, May 13th were issued a dividend of $1.19 per share. This represents a $4.76 dividend on an annualized basis and a dividend yield of 4.5%. The ex-dividend date was Wednesday, May 13th. This is a positive change from Paychex's previous quarterly dividend of $1.08. Paychex's payout ratio is currently 97.34%.

Insider Activity at Paychex

In related news, Director Joseph M. Tucci sold 3,907 shares of the stock in a transaction on Friday, June 26th. The stock was sold at an average price of $98.25, for a total value of $383,862.75. Following the transaction, the director directly owned 67,364 shares of the company's stock, valued at approximately $6,618,513. This trade represents a 5.48% decrease in their position. The sale was disclosed in a filing with the SEC, which can be accessed through the SEC website. 0.80% of the stock is currently owned by insiders.

Institutional Investors Weigh In On Paychex

Several institutional investors and hedge funds have recently added to or reduced their stakes in the company. Vanguard Group Inc. raised its stake in shares of Paychex by 12.1% in the 4th quarter. Vanguard Group Inc. now owns 42,348,625 shares of the business services provider's stock valued at $4,750,669,000 after acquiring an additional 4,583,157 shares during the period. LBP AM SA boosted its position in Paychex by 125.2% during the 4th quarter. LBP AM SA now owns 40,517 shares of the business services provider's stock worth $4,545,000 after purchasing an additional 22,527 shares during the period. Tectonic Advisors LLC boosted its position in Paychex by 17.4% during the 4th quarter. Tectonic Advisors LLC now owns 79,708 shares of the business services provider's stock worth $8,942,000 after purchasing an additional 11,805 shares during the period. Comerica Bank increased its holdings in Paychex by 10.4% in the 4th quarter. Comerica Bank now owns 121,705 shares of the business services provider's stock valued at $13,653,000 after purchasing an additional 11,497 shares in the last quarter. Finally, Danske Bank A S increased its holdings in Paychex by 14.0% in the 4th quarter. Danske Bank A S now owns 205,341 shares of the business services provider's stock valued at $23,035,000 after purchasing an additional 25,184 shares in the last quarter. 83.47% of the stock is currently owned by institutional investors and hedge funds.

Key Stories Impacting Paychex

Here are the key news stories impacting Paychex this week:

• Positive Sentiment: Zacks Research raised multiple EPS estimates for Paychex, including FY2027, FY2028 and FY2029, signaling stronger long-term profit expectations.
• Positive Sentiment: The firm also increased forecasts for several quarterly periods, including Q1 2027, Q2 2027, Q3 2027 and Q4 2028, reinforcing a constructive earnings outlook.
• Neutral Sentiment: Recent commentary highlighted Paychex’s improving small-business hiring trends, AI expansion and workplace recognition, which support the company’s growth narrative. Article Title
• Negative Sentiment: Some estimates were cut, including Q4 2027, Q1 2028, Q3 2028 and FY2028 EPS, which may temper enthusiasm around near- to mid-term growth.

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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