Update shared on04 Sep 2025
Paychex’s analyst price target remained unchanged at $147.33 as mixed sentiment—driven by weaker-than-expected Q4 results, softer revenue growth, integration concerns surrounding the Paycor deal, and uncertainty over FY26 projections—was offset by a stable client base and resilient underlying demand.
Analyst Commentary
- Bearish analysts highlight weaker-than-expected Q4 and softer organic revenue growth, with Paychex’s fiscal 2026 guidance falling below investor expectations.
- Persistent uncertainty and confusion over FY26 projections, as well as the timing of annual price increases, have impacted analyst confidence and complicated year-over-year comparisons.
- The integration of Paycor is cited as a near-term distraction impacting management’s focus and contributing to revenue growth headwinds.
- Despite some weakening data points, the overall installed base is viewed as stable, and analysts do not anticipate an imminent recession risk.
- Bullish analysts have revised up models to reflect the Paycor acquisition and continue to see underlying support from resilient end market demand and employment trends, though near-term EPS expectations are tempered.
What's in the News
- Paychex announced a partnership with SoFi to offer SoFi at Work financial solutions through Paychex Flex® Perks, expanding employee access to loans, refinancing, and financial guidance.
- Since its launch, over 230,000 employees have purchased at least one benefit from the Paychex Flex Perks digital marketplace; Paychex plans to further expand offerings based on trends and feedback.
- The company completed the repurchase of 828,855 shares (0.23% of shares) for $104.02 million under its previously announced buyback plan; no shares were repurchased from March to May 2025.
- Paychex provided guidance for fiscal year ending May 31, 2026, projecting total revenue growth in the range of 16.5% to 18.5%.
Valuation Changes
Summary of Valuation Changes for Paychex
- The Consensus Analyst Price Target remained effectively unchanged, at $147.33.
- The Future P/E for Paychex remained effectively unchanged, moving only marginally from 28.40x to 28.48x.
- The Discount Rate for Paychex remained effectively unchanged, at 7.15%.
Disclaimer
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