Paychex, Inc. (NASDAQ:PAYX) Receives Average Recommendation of “Reduce” from Analysts

Shares of Paychex, Inc. (NASDAQ:PAYX) have received a consensus recommendation of “Reduce” from the nineteen brokerages that are covering the firm, MarketBeat.com reports. Four equities research analysts have rated the stock with a sell recommendation, fourteen have assigned a hold recommendation and one has given a buy recommendation to the company. The average twelve-month price objective among brokerages that have updated their coverage on the stock in the last year is $121.3750.

Several research analysts have issued reports on PAYX shares. Stifel Nicolaus decreased their target price on Paychex from $137.00 to $126.00 and set a “hold” rating for the company in a research report on Wednesday, December 17th. Stephens reduced their price target on shares of Paychex from $135.00 to $125.00 and set an “equal weight” rating on the stock in a research note on Monday, December 22nd. Cantor Fitzgerald upgraded shares of Paychex to a “strong sell” rating in a report on Tuesday, January 27th. TD Cowen reissued a “hold” rating on shares of Paychex in a research report on Monday, December 1st. Finally, Royal Bank Of Canada dropped their target price on shares of Paychex from $125.00 to $102.00 and set a “sector perform” rating on the stock in a research note on Thursday.

Paychex Price Performance

Shares of NASDAQ:PAYX opened at $92.55 on Friday. 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 has a 1-year low of $86.89 and a 1-year high of $161.24. The firm’s 50 day simple moving average is $98.48 and its two-hundred day simple moving average is $112.30. The company has a market capitalization of $33.22 billion, a P/E ratio of 20.99 and a beta of 0.91.

Paychex (NASDAQ:PAYX) last posted its earnings results on Friday, December 19th. The business services provider reported $1.26 earnings per share for the quarter, beating the consensus estimate of $1.23 by $0.03. The company had revenue of $1.56 billion during the quarter, compared to analysts’ expectations of $1.55 billion. Paychex had a net margin of 26.45% and a return on equity of 46.38%. Paychex’s quarterly revenue was up 18.3% on a year-over-year basis. During the same period last year, the company posted $1.14 earnings per share. Research analysts expect that Paychex will post 4.99 EPS for the current fiscal year.

Paychex announced that its Board of Directors has initiated a stock repurchase plan on Friday, January 16th that authorizes the company to buyback $1.00 billion in outstanding shares. This buyback authorization authorizes the business services provider to reacquire up to 2.5% of its shares through open market purchases. Shares buyback plans are often a sign that the company’s management believes its shares are undervalued.

Paychex Announces Dividend

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

Institutional Investors Weigh In On Paychex

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in PAYX. Heartwood Wealth Advisors LLC purchased a new position in shares of Paychex during the 3rd quarter valued at about $25,000. Vermillion & White Wealth Management Group LLC purchased a new stake in shares of Paychex in the third quarter worth about $27,000. Cornerstone Planning Group LLC grew its holdings in Paychex by 957.1% during the fourth quarter. Cornerstone Planning Group LLC now owns 296 shares of the business services provider’s stock worth $30,000 after acquiring an additional 268 shares during the period. Stance Capital LLC purchased a new position in Paychex during the third quarter valued at approximately $31,000. Finally, Hilton Head Capital Partners LLC purchased a new position in Paychex during the fourth quarter valued at approximately $31,000. 83.47% of the stock is currently owned by hedge funds and other institutional investors.

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.