Paychex (NASDAQ:PAYX) to Repurchase $1.00 billion in Outstanding Shares

Paychex (NASDAQ:PAYX) announced that its board has approved a share buyback plan on Friday, January 16th, RTT News reports. The company plans to buyback $1.00 billion in shares. This buyback authorization permits the business services provider to reacquire up to 2.5% of its shares through open market purchases. Shares buyback plans are usually a sign that the company’s leadership believes its stock is undervalued.

Analyst Upgrades and Downgrades

Several research firms have issued reports on PAYX. Morgan Stanley cut their price target on shares of Paychex from $133.00 to $123.00 and set an “equal weight” rating on the stock in a report on Monday, December 22nd. Cowen restated a “hold” rating on shares of Paychex in a research note on Monday, December 1st. UBS Group decreased their price target on Paychex from $140.00 to $132.00 and set a “neutral” rating for the company in a research note on Thursday, October 2nd. Argus dropped their price target on Paychex from $150.00 to $130.00 and set a “buy” rating on the stock in a research note on Friday, January 2nd. Finally, Wolfe Research cut their price objective on shares of Paychex from $130.00 to $115.00 and set an “underperform” rating on the stock in a report on Wednesday, December 10th. One analyst has rated the stock with a Buy rating, fourteen have issued a Hold rating and three have issued a Sell rating to the company’s stock. Based on data from MarketBeat, the company presently has an average rating of “Reduce” and an average target price of $125.67.

Paychex Stock Up 0.6%

NASDAQ PAYX opened at $111.18 on Monday. The business has a fifty day moving average price of $112.25 and a 200 day moving average price of $126.22. The company has a debt-to-equity ratio of 1.17, a quick ratio of 1.27 and a current ratio of 1.27. The company has a market cap of $39.91 billion, a P/E ratio of 25.21 and a beta of 0.91. Paychex has a one year low of $107.80 and a one year high of $161.24.

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

Paychex Dividend Announcement

The business also recently declared a quarterly dividend, which will be paid on Friday, February 27th. Investors of record on Wednesday, January 28th will be issued a $1.08 dividend. This represents a $4.32 annualized dividend and a dividend yield of 3.9%. The ex-dividend date of this dividend is Wednesday, January 28th. Paychex’s dividend payout ratio (DPR) is currently 97.96%.

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.