Analysts Set Paychex, Inc. (NASDAQ:PAYX) Target Price at $122.81

Shares of Paychex, Inc. (NASDAQ:PAYX) have been assigned an average recommendation of “Reduce” from the eighteen ratings firms that are currently covering the firm, Marketbeat Ratings reports. Four analysts have rated the stock with a sell recommendation, thirteen have given a hold recommendation and one has issued a buy recommendation on the company. The average twelve-month price objective among brokerages that have covered the stock in the last year is $122.8125.

A number of research firms have recently weighed in on PAYX. Cantor Fitzgerald upgraded shares of Paychex to a “strong sell” rating in a report on Tuesday, January 27th. Stephens lowered their target price on shares of Paychex from $135.00 to $125.00 and set an “equal weight” rating on the stock in a research report on Monday, December 22nd. Morgan Stanley cut their target price on Paychex from $133.00 to $123.00 and set an “equal weight” rating on the stock in a report on Monday, December 22nd. Wolfe Research reduced their price target on Paychex from $130.00 to $115.00 and set an “underperform” rating for the company in a research report on Wednesday, December 10th. Finally, Wells Fargo & Company decreased their price target on Paychex from $128.00 to $116.00 and set an “underweight” rating for the company in a research note on Tuesday, December 9th.

Institutional Investors Weigh In On Paychex

Several hedge funds and other institutional investors have recently modified their holdings of the stock. ABC Arbitrage SA boosted its stake in Paychex by 61.4% in the 3rd quarter. ABC Arbitrage SA now owns 28,208 shares of the business services provider’s stock valued at $3,576,000 after buying an additional 10,726 shares in the last quarter. GSA Capital Partners LLP acquired a new position in Paychex during the third quarter worth $1,877,000. Summit Global Investments raised its stake in Paychex by 1,938.2% during the third quarter. Summit Global Investments now owns 48,143 shares of the business services provider’s stock worth $6,103,000 after acquiring an additional 45,781 shares in the last quarter. Alps Advisors Inc. lifted its holdings in shares of Paychex by 20.6% during the third quarter. Alps Advisors Inc. now owns 240,564 shares of the business services provider’s stock valued at $30,494,000 after acquiring an additional 41,114 shares during the period. Finally, Invesco Ltd. lifted its holdings in shares of Paychex by 6.0% during the second quarter. Invesco Ltd. now owns 4,384,846 shares of the business services provider’s stock valued at $637,820,000 after acquiring an additional 249,550 shares during the period. Institutional investors and hedge funds own 83.47% of the company’s stock.

Paychex Trading Down 0.7%

PAYX opened at $92.43 on Friday. The firm’s fifty day moving average price is $99.78 and its 200 day moving average price is $113.10. Paychex has a 12-month low of $86.89 and a 12-month high of $161.24. The stock has a market capitalization of $33.18 billion, a PE ratio of 20.96 and a beta of 0.91. The company has a debt-to-equity ratio of 1.17, a current ratio of 1.27 and a quick ratio of 1.27.

Paychex (NASDAQ:PAYX) last released its quarterly earnings results on Friday, December 19th. The business services provider reported $1.26 earnings per share for the quarter, beating analysts’ consensus estimates of $1.23 by $0.03. Paychex had a return on equity of 46.38% and a net margin of 26.45%.The company had revenue of $1.56 billion for the quarter, compared to analysts’ expectations of $1.55 billion. During the same quarter in the previous year, the company posted $1.14 earnings per share. The business’s revenue for the quarter was up 18.3% compared to the same quarter last year. Paychex has set its FY 2026 guidance at 5.480-5.530 EPS. As a group, research analysts expect that Paychex will post 4.99 EPS for the current fiscal year.

Paychex Dividend Announcement

The company also recently announced a quarterly dividend, which was paid on Friday, February 27th. Investors of record on Wednesday, January 28th were issued a $1.08 dividend. This represents a $4.32 annualized dividend and a yield of 4.7%. The ex-dividend date was Wednesday, January 28th. Paychex’s dividend payout ratio (DPR) is 97.96%.

Paychex announced that its board has initiated a share buyback plan on Friday, January 16th that permits the company to buyback $1.00 billion in shares. This buyback authorization permits the business services provider to purchase up to 2.5% of its stock through open market purchases. Stock buyback plans are usually a sign that the company’s board of directors believes its shares are undervalued.

About Paychex

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.