Update shared on23 Sep 2025
Fair value Decreased 1.02%Paychex’s consensus price target was revised slightly lower to $145.08 as analysts cite slower organic revenue growth, lack of FY26 guidance clarity, and a subdued sector outlook amid macroeconomic headwinds, suggesting shares may remain range-bound.
Analyst Commentary
- Slower organic revenue growth in Management Solutions, partly attributed to integration distractions, is weighing on near-term performance and expectations.
- FY26 guidance clarity is lacking, with conflicting signals and earlier-than-usual price increases distorting fiscal comparisons and amplifying investor uncertainty.
- Macroeconomic and employment data remain sluggish, leading to tempered sector-wide expectations and increased volatility across human capital management (HCM) stocks.
- The growth outlook is back-end loaded and management's normalized growth guidance is notably below investor expectations, raising questions about Paychex’s core business momentum.
- Despite weakening data points, the company’s installed client base appears stable and analysts see no indications of an imminent recession, although forecasts for fiscal 2026 are viewed as lackluster and likely to keep shares range-bound.
What's in the News
- Paychex launched "Bill Pay, Powered by BILL" within Paychex Flex, integrating payroll, HR, and accounts payable to help SMBs automate bill payments, gain real-time payment insights, and access BILL's business network.
- The company formed a partnership with SoFi to add SoFi at Work to Paychex Flex Perks, expanding financial well-being resources and enabling employees to access benefits like personal loans and refinancing through an employer-curated digital marketplace.
- Paychex expects total revenue growth of 16.5% to 18.5% for the fiscal year ending May 31, 2026.
- From March 1 to May 31, 2025, Paychex repurchased 0 shares, completing the previously announced buyback with a total of 828,855 shares repurchased for $104.02 million.
Valuation Changes
Summary of Valuation Changes for Paychex
- The Consensus Analyst Price Target remained effectively unchanged, moving only marginally from $146.58 to $145.08.
- The Future P/E for Paychex remained effectively unchanged, moving only marginally from 28.28x to 28.09x.
- The Discount Rate for Paychex remained effectively unchanged, moving only marginally from 7.18% to 7.21%.
Disclaimer
AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.