Paychex (NASDAQ:PAYX) Sets New 52-Week Low – Should You Sell?

Paychex, Inc. (NASDAQ:PAYX) shares hit a new 52-week low during mid-day trading on Monday . The stock traded as low as $106.40 and last traded at $106.0450, with a volume of 137063 shares trading hands. The stock had previously closed at $106.63.

Wall Street Analysts Forecast Growth

Several brokerages have commented on PAYX. JPMorgan Chase & Co. dropped their target price on shares of Paychex from $140.00 to $125.00 and set an “underweight” rating on the stock in a report on Monday, December 22nd. Stephens cut their price objective 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. Royal Bank Of Canada lowered their target price on Paychex from $150.00 to $125.00 and set a “sector perform” rating for the company in a report on Friday, December 5th. Argus cut their price target on Paychex from $150.00 to $130.00 and set a “buy” rating on the stock in a report on Friday, January 2nd. Finally, Jefferies Financial Group set a $110.00 price objective on Paychex in a research report on Friday, December 19th. One investment analyst has rated the stock with a Buy rating, thirteen have given a Hold rating and three have issued a Sell rating to the company’s stock. According to MarketBeat.com, Paychex has an average rating of “Reduce” and an average target price of $125.67.

Paychex Stock Performance

The stock has a market capitalization of $38.18 billion, a P/E ratio of 24.06 and a beta of 0.91. The company has a quick ratio of 1.27, a current ratio of 1.27 and a debt-to-equity ratio of 1.17. The stock has a 50 day simple moving average of $111.88 and a two-hundred day simple moving average of $124.88.

Paychex (NASDAQ:PAYX) last released 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. Paychex had a net margin of 26.45% and a return on equity of 46.38%. The business had revenue of $1.56 billion during the quarter, compared to analysts’ expectations of $1.55 billion. During the same period last year, the business earned $1.14 earnings per share. The firm’s revenue was up 18.3% on a year-over-year basis. Paychex has set its FY 2026 guidance at 5.480-5.530 EPS. On average, equities analysts forecast that Paychex, Inc. will post 4.99 EPS for the current fiscal year.

Paychex Announces Dividend

The company also recently announced a quarterly dividend, which will be paid on Friday, February 27th. Stockholders of record on Wednesday, January 28th will be issued a $1.08 dividend. This represents a $4.32 dividend on an annualized basis and a dividend yield of 4.1%. The ex-dividend date of this dividend is Wednesday, January 28th. Paychex’s dividend payout ratio is presently 97.96%.

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

Hedge Funds Weigh In On Paychex

A number of institutional investors have recently bought and sold shares of PAYX. Heartwood Wealth Advisors LLC acquired a new position in shares of Paychex during the 3rd quarter worth approximately $25,000. Vermillion & White Wealth Management Group LLC bought a new position in Paychex during the third quarter worth $27,000. NewSquare Capital LLC increased its holdings in shares of Paychex by 83.8% in the second quarter. NewSquare Capital LLC now owns 215 shares of the business services provider’s stock valued at $31,000 after purchasing an additional 98 shares during the last quarter. Stance Capital LLC bought a new position in shares of Paychex in the third quarter valued at about $31,000. Finally, MMA Asset Management LLC acquired a new stake in shares of Paychex during the 3rd quarter worth about $32,000. Institutional investors and hedge funds own 83.47% of the company’s stock.

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.