Paychex (NASDAQ:PAYX) Sees Large Volume Increase on Strong Earnings

Paychex, Inc. (NASDAQ:PAYX) saw an uptick in trading volume on Wednesday following a stronger than expected earnings report. 1,366,527 shares traded hands during mid-day trading, a decline of 23% from the previous session’s volume of 1,776,359 shares.The stock last traded at $118.86 and had previously closed at $125.03.

The business services provider reported $1.12 EPS for the quarter, topping the consensus estimate of $1.10 by $0.02. The firm had revenue of $1.30 billion during the quarter, compared to analysts’ expectations of $1.29 billion. Paychex had a return on equity of 46.14% and a net margin of 31.86%. Paychex’s quarterly revenue was up 5.3% compared to the same quarter last year. During the same period last year, the business earned $0.97 earnings per share.

Paychex Increases Dividend

The company also recently announced a quarterly dividend, which was paid on Thursday, May 30th. Investors of record on Friday, May 10th were given a $0.98 dividend. This is a boost from Paychex’s previous quarterly dividend of $0.89. This represents a $3.92 annualized dividend and a yield of 3.34%. The ex-dividend date was Thursday, May 9th. Paychex’s dividend payout ratio (DPR) is 85.40%.

Wall Street Analysts Forecast Growth

Several research analysts recently commented on PAYX shares. Royal Bank of Canada reaffirmed a “sector perform” rating and issued a $130.00 target price on shares of Paychex in a research report on Tuesday, May 21st. TD Cowen dropped their price objective on Paychex from $122.00 to $121.00 and set a “hold” rating for the company in a research note on Wednesday, April 3rd. Evercore ISI reiterated an “in-line” rating and set a $118.00 price objective on shares of Paychex in a research note on Tuesday, March 26th. Wedbush reiterated a “neutral” rating and set a $115.00 price objective on shares of Paychex in a research note on Wednesday, April 3rd. Finally, Bank of America increased their price objective on Paychex from $108.00 to $111.00 and gave the stock an “underperform” rating in a research note on Wednesday, April 3rd. Two investment analysts have rated the stock with a sell rating and ten have issued a hold rating to the stock. According to data from MarketBeat.com, Paychex currently has a consensus rating of “Hold” and a consensus target price of $123.00.

Insider Activity

In related news, Director David J. S. Flaschen sold 19,709 shares of the firm’s stock in a transaction dated Friday, May 24th. The stock was sold at an average price of $124.55, for a total value of $2,454,755.95. Following the transaction, the director now owns 5,383 shares in the company, valued at $670,452.65. The transaction was disclosed in a document filed with the SEC, which is available through this hyperlink. 11.50% of the stock is currently owned by corporate insiders.

Hedge Funds Weigh In On Paychex

Several hedge funds have recently added to or reduced their stakes in PAYX. Chilton Capital Management LLC bought a new position in Paychex during the first quarter worth about $31,000. ESL Trust Services LLC bought a new position in Paychex during the first quarter worth about $31,000. Fortis Group Advisors LLC bought a new position in Paychex during the third quarter worth about $34,000. Clear Investment Research LLC boosted its holdings in Paychex by 55.8% during the fourth quarter. Clear Investment Research LLC now owns 307 shares of the business services provider’s stock worth $37,000 after buying an additional 110 shares during the last quarter. Finally, Criterion Capital Advisors LLC bought a new position in Paychex during the fourth quarter worth about $40,000. Institutional investors own 83.47% of the company’s stock.

Paychex Stock Performance

The company has a quick ratio of 1.24, a current ratio of 1.24 and a debt-to-equity ratio of 0.21. The stock has a market cap of $42.26 billion, a P/E ratio of 25.58, a PEG ratio of 3.47 and a beta of 0.96. The stock has a fifty day simple moving average of $122.43 and a 200-day simple moving average of $122.09.

Paychex Company Profile

Paychex, Inc provides integrated human capital management solutions for human resources (HR), payroll, benefits, 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.