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NASDAQ:PAYX

Paychex (PAYX)

98.25
+0.01 (0.01%)
as of Jun 18, 2026, 7:59:59 pm Market Open.
101 watching
0
Investor Insights
star iconJun 19, 2026, 12:00 am

This summary was created by AI, based on 4 opinions in the last 12 months.

Paychex (PAYX-Q) is navigating a complex environment, with a current annual dividend yield of around 4.5% to 4.7%. There are concerns stemming from fears that AI could disrupt its core business, although some experts believe that AI could actually complement their operations, enhancing the data available for small and medium businesses. Recent performance shows a decline of 14% over the past three months despite a solid focus on serving small businesses, prompting investors to be cautious given worries over unemployment rates. A recent mixed earnings report highlighted in-line earnings but lower revenue projections, contributing to a 9% drop in stock price. Despite these fluctuations and market sentiment, there is potential optimism surrounding their merger with Paycore, which might have impacted their recent financial results.

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Consensus
Cautious
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Valuation
Fair Value
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Similar
ADP
BUY
They blew away their report 2 weeks ago. Anyone that helps companies hire workers during this labour shortage wins.
TOP PICK
Automated payroll deposit company. Earnings beat forecast and streets in the 12-14% range. If interest rates rise, this will be a bonus for the company. They bank all payroll tax remittances over a weekend, which makes a good amount of money. Management solution side of the business is growing. (Analysts’ price target is $116.22)
BUY
It's the second-biggest payroll processor in the U.S. with a big outsourced HR division doing very well as a kicker. They delivered a super quarter last week, with top and bottom line beats and raising their full-year forecast across the board. It's risen near it's all-time high.
WATCH
A stable company that processes payroll for 750,000 companies around the US. A stable business that will grow along with the economy. Trading at a pricy 35x earnings. Predictability is very high but they look at growth against own history and other competition. There may be an opportunity in the future to enter.
BUY
They report Friday. Typically, they report hot, then shares tumble, but this time shares have plunged ahead of the report.
BUY ON WEAKNESS

A competitor with ADP. The smaller of the two. Has been great performer but it is a little ahead of itself. If the US dollar continues to decline, you could see a good opportunity. Interest rates and strong job growth will be a stimulus.

BUY
On Monday, it hit an all-time high during a fabulous jobs report, but then yesterday the market didn't like its quarterly report, which beat in earnings, inline sales and slightly raised full-year forecast. He liked this report, but Wall Street didn't. PAYX shares plunged 5%. He saw this coming, because PAYX tends to report good numbers then sells off, which creates a buying opportunity before grinding higher.
PAST TOP PICK
(A Top Pick Feb 07/20, Up 7%) Services small businesses, and that's what the recovery will be about. Cash cow stock.
BUY
The stimulus package is a plus, but the vaccine roll-out has been a disaster. PAYX delivered a strong beat two days before Christmas, rallied $3, but then reversed and is now 10% off its peak. Nuts. Everytime this pulls back from a great quarter, it's a buying opportunity
COMMENT
Today it reported a solid top and bottom beat, and raised their forecast. Revenues and earnings are down, though, but today's numbers far exceeded expectations. Still, the stock fell 2.5% today. After last July's report, the stock also sold off but then came back. This pattern could repeat.
DON'T BUY
PAYX has a solid reputation, but everyone in payroll processing faces rising jobless claims and layoffs and this hurts this sector. Payroll is driven by macro factors, not business fundamentals. Avoid this space and wait until a recession bottom and payrolls improve. Also, these companies won't earn interest on the floats they hold because rates are near zero.
TOP PICK
If you believe the job numbers from Monday, they were substantial. This name is a beneficiary from job growth. They deal with small and mid-sized companies with and pays out a dividend of 3.6%. They have been growing business into HR so the dividend is going higher. It's a cash cow since they bank the payroll money. (Analysts’ price target is $85.44)
PARTIAL BUY
Take a half-position now, then wait for a pullback. As businesses hire, PAYX will do well. And US unemployment is at record lows. He's owned this forever and will hold on. Drill down on US unemployment figures, because it isn't balanced; there are pockets of higher unemployment which is concerning.
BUY ON WEAKNESS

non-FANG suggestion? He likes the payment processing space -- ADP, Paychex, Visa, or Mastercard. He would like to buy on a dip.

BUY ON WEAKNESS
At the end of the day, the FED is just printing money. They are trying to focus on the REPO market. He is positive about the stock. It is in the top 100 of the S&P 500. This stock ticks all the boxes. Model price is $75.28, -11% but certainly on a pullback would be a buyer.
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