NasdaqGS:PAYX

Stock Analysis Report

Executive Summary

Paychex, Inc. provides integrated human capital management solutions for payroll, benefits, human resource (HR), retirement, and insurance services for small- to medium-sized businesses in the United States and Europe.

Snowflake

Fundamentals

Excellent balance sheet established dividend payer.


Similar Companies

Share Price & News

How has Paychex's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

1.9%

NasdaqGS:PAYX

0.1%

US IT

-0.02%

US Market


1 Year Return

11.9%

NasdaqGS:PAYX

15.0%

US IT

1.6%

US Market

PAYX underperformed the IT industry which returned 16% over the past year.

PAYX outperformed the Market in United States of America which returned 1.9% over the past year.


Share holder returns

PAYXIndustryMarket
7 Day1.9%0.1%-0.02%
30 Day0.6%-1.0%2.7%
90 Day-5.5%0.9%1.4%
1 Year15.4%11.9%16.3%15.0%3.8%1.6%
3 Year52.6%38.7%95.4%87.2%45.2%35.8%
5 Year121.7%88.6%141.6%117.2%61.8%44.1%

Price Volatility Vs. Market

How volatile is Paychex's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Paychex undervalued based on future cash flows and its price relative to the stock market?

28.74x

Price to Earnings (PE) ratio


Intrinsic Value Based on Future Cash Flows

Paychex's share price is above the future cash flow value, it's not available at a moderate discount (< 20%).

Paychex's share price is above the future cash flow value, it's not available at a substantial discount (< 40%).


Price Based on Earnings

Paychex is good value based on earnings compared to the US IT industry average.

Paychex is overvalued based on earnings compared to the United States of America market.


Price Based on Expected Growth

Paychex is poor value based on expected growth next year.


Price Based on Value of Assets

Paychex is overvalued based on assets compared to the US IT industry average.


Next Steps

Future Growth

How is Paychex expected to perform in the next 1 to 3 years based on estimates from 17 analysts?

7.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Estimates


Future Annual Growth Analysis

Paychex's revenue is expected to grow by 6.6% yearly, however this is not considered high growth (20% yearly).

Paychex's earnings are expected to grow by 7.6% yearly, however this is not considered high growth (20% yearly).

Paychex's revenue growth is positive but not above the United States of America market average.

Paychex's earnings growth is positive but not above the United States of America market average.

Paychex's earnings growth is expected to exceed the low risk savings rate of 2.7%.


Earnings per Share Growth Estimates


Future Return on Equity

Paychex is expected to efficiently use shareholders’ funds in the future (Return on Equity greater than 20%).


Next Steps

Past Performance

How has Paychex performed over the past 5 years?

10.2%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Paychex's year on year earnings growth rate has been positive over the past 5 years.

Paychex's 1-year earnings growth is less than its 5-year average (4.1% vs 10.2%)

Paychex's earnings growth has not exceeded the US IT industry average in the past year (4.1% vs 11.2%).


Return on Equity

Paychex has efficiently used shareholders’ funds last year (Return on Equity greater than 20%).


Return on Assets

Paychex used its assets more efficiently than the US IT industry average last year based on Return on Assets.


Return on Capital Employed

Paychex's use of capital deteriorated last year versus 3 years ago (Return on Capital Employed).


Next Steps

Financial Health

How is Paychex's financial position?


Financial Position Analysis

Paychex is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.

Paychex's cash and other short term assets cover its long term commitments.


Debt to Equity History and Analysis

Paychex's level of debt (30.4%) compared to net worth is satisfactory (less than 40%).

Unable to establish if Paychex's debt level has increased without past 5-year debt data.

Debt is well covered by operating cash flow (159.7%, greater than 20% of total debt).

Interest payments on debt are well covered by earnings (EBIT is 320.1x coverage).


Balance Sheet

Low level of unsold assets.

Debt is covered by short term assets, assets are 7.1x debt.


Next Steps

Dividend

What is Paychex's current dividend yield, its reliability and sustainability?

2.92%

Expected Dividend Yield


Dividend Yield and Payments Analysis

Paychex's pays a higher dividend yield than the bottom 25% of dividend payers in United States of America (1.44%).

Paychex's dividend is below the markets top 25% of dividend payers in United States of America (3.69%).

Dividends per share have been stable in the past 10 years.

Dividends per share have increased over the past 10 years.


Current Payout to Shareholders

Dividends paid are covered by earnings (1.3x coverage).


Future Payout to Shareholders

Dividends after 3 years are expected to be covered by earnings (1.4x coverage).


Next Steps

Management

What is the CEO of Paychex's salary, the management and board of directors tenure and is there insider trading?

7.9yrs

Average management tenure


CEO

Marty Mucci (59yo)

9yrs

Tenure

US$6,736,164

Compensation

Mr. Martin Mucci has been the Chief Executive Officer and President of Paychex, Inc. since September 30, 2010. Mr. Mucci served as the Senior Vice President of Operations at Paychex Inc., since October 200 ...


CEO Compensation Analysis

Marty's remuneration is lower than average for companies of similar size in United States of America.

Marty's compensation has been consistent with company performance over the past year, both up more than 20%.


Management Age and Tenure

7.9yrs

Average Tenure

58yo

Average Age

The average tenure for the Paychex management team is over 5 years, this suggests they are a seasoned and experienced team.


Board Age and Tenure

8.9yrs

Average Tenure

63yo

Average Age

The tenure for the Paychex board of directors is about average.


Insider Trading

Paychex individual insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$63,00105 Aug 19
Robert Schrader
EntityIndividual
Role
Chief Accounting Officer
VP, Controller & Principal Accounting Officer
Shares751
Max PriceUS$83.93
SellUS$15,34415 Jul 19
Laurie Zaucha
EntityIndividual
Shares179
Max PriceUS$85.72
SellUS$22,11615 Jul 19
Stephanie Schaeffer
EntityIndividual
Role
Chief Legal Officer
VP, Chief Legal Officer & Corporate Secretary
Shares258
Max PriceUS$85.72
SellUS$40,80315 Jul 19
Efrain Rivera
EntityIndividual
Role
Treasurer
Senior VP
Shares476
Max PriceUS$85.72
SellUS$229,90115 Jul 19
Martin Mucci
EntityIndividual
Role
Chief Executive Officer
President
Shares2,682
Max PriceUS$85.72
SellUS$44,14615 Jul 19
Michael Gioja
EntityIndividual
Role
Senior Key Executive
Senior Vice President of Product Development & Information Technology
Shares515
Max PriceUS$85.72
SellUS$30,68815 Jul 19
John Gibson
EntityIndividual
Role
Senior Key Executive
Senior Vice President of Service
Shares358
Max PriceUS$85.72
SellUS$25,20215 Jul 19
Mark Bottini
EntityIndividual
Role
Head of Sales
Senior Vice President of Sales
Shares294
Max PriceUS$85.72
SellUS$12,88512 Jul 19
Laurie Zaucha
EntityIndividual
Shares151
Max PriceUS$85.33
SellUS$18,51712 Jul 19
Stephanie Schaeffer
EntityIndividual
Role
Chief Legal Officer
VP, Chief Legal Officer & Corporate Secretary
Shares217
Max PriceUS$85.33
SellUS$209,57012 Jul 19
Martin Mucci
EntityIndividual
Role
Chief Executive Officer
President
Shares2,456
Max PriceUS$85.33
SellUS$37,03312 Jul 19
Michael Gioja
EntityIndividual
Role
Senior Key Executive
Senior Vice President of Product Development & Information Technology
Shares434
Max PriceUS$85.33
SellUS$25,68412 Jul 19
John Gibson
EntityIndividual
Role
Senior Key Executive
Senior Vice President of Service
Shares301
Max PriceUS$85.33
SellUS$21,16212 Jul 19
Mark Bottini
EntityIndividual
Role
Head of Sales
Senior Vice President of Sales
Shares248
Max PriceUS$85.33
SellUS$115,93609 Jul 19
Laurie Zaucha
EntityIndividual
Shares1,359
Max PriceUS$85.31
SellUS$196,55409 Jul 19
Jennifer Vossler
EntityIndividual
Shares2,304
Max PriceUS$85.31
SellUS$152,79009 Jul 19
Stephanie Schaeffer
EntityIndividual
Role
Chief Legal Officer
VP, Chief Legal Officer & Corporate Secretary
Shares1,791
Max PriceUS$85.31
SellUS$799,60909 Jul 19
Efrain Rivera
EntityIndividual
Role
Treasurer
Senior VP
Shares9,405
Max PriceUS$85.31
SellUS$1,685,64009 Jul 19
Martin Mucci
EntityIndividual
Role
Chief Executive Officer
President
Shares19,759
Max PriceUS$85.31
SellUS$334,07409 Jul 19
Michael Gioja
EntityIndividual
Role
Senior Key Executive
Senior Vice President of Product Development & Information Technology
Shares3,916
Max PriceUS$85.31
SellUS$231,70209 Jul 19
John Gibson
EntityIndividual
Role
Senior Key Executive
Senior Vice President of Service
Shares2,716
Max PriceUS$85.31
SellUS$201,84309 Jul 19
Mark Bottini
EntityIndividual
Role
Head of Sales
Senior Vice President of Sales
Shares2,366
Max PriceUS$85.31
BuyUS$129,90026 Oct 18
Joseph Doody
EntityIndividual
Role
Member of the Board of Directors
Director
Shares2,000
Max PriceUS$65.50
BuyUS$66,50024 Oct 18
Joseph Doody
EntityIndividual
Role
Member of the Board of Directors
Director
Shares1,000
Max PriceUS$66.50

Ownership Breakdown


Management Team

  • Marty Mucci (59yo)

    President

    • Tenure: 9yrs
    • Compensation: US$6.74m
  • Efrain Rivera (62yo)

    Senior VP

    • Tenure: 8.3yrs
    • Compensation: US$3.24m
  • John Gibson (52yo)

    Senior Vice President of Service

    • Tenure: 6.3yrs
    • Compensation: US$1.75m
  • Mike Gioja (61yo)

    Senior Vice President of Product Development & Information Technology

    • Tenure: 8.2yrs
    • Compensation: US$1.75m
  • Mark Bottini (58yo)

    Senior Vice President of Sales

    • Tenure: 7.9yrs
    • Compensation: US$1.68m
  • Stephanie Schaeffer (49yo)

    VP, Chief Legal Officer & Corporate Secretary

    • Tenure: 13.7yrs
  • Frank Fiorille

    Vice President of Risk

    • Tenure: 2.7yrs
  • Terri Allen

    Investor Relations

    • Tenure: 0yrs
  • Chris DeSalvo

    Vice President of Service Excellence & Operations

    • Tenure: 0.5yrs
  • Robert Schrader (47yo)

    VP, Controller & Principal Accounting Officer

    • Tenure: 0.2yrs

Board Members

  • Joe Tucci (72yo)

    Lead Independent Director

    • Tenure: 0yrs
    • Compensation: US$235.71k
  • Joe Doody (67yo)

    Director

    • Tenure: 8.9yrs
    • Compensation: US$218.71k
  • Pam Joseph (60yo)

    Director

    • Tenure: 1.4yrs
    • Compensation: US$20.00k
  • B. Golisano (77yo)

    Chairman

    • Tenure: 14.9yrs
    • Compensation: US$300.00k
  • David Flaschen (63yo)

    Director

    • Tenure: 20.7yrs
    • Compensation: US$258.21k
  • Marty Mucci (59yo)

    President

    • Tenure: 9yrs
    • Compensation: US$6.74m
  • Joe Velli (61yo)

    Director

    • Tenure: 12.7yrs
    • Compensation: US$233.21k
  • Tom Bonadio (70yo)

    Director

    • Tenure: 2.7yrs
    • Compensation: US$223.71k
  • Kara Wilson (49yo)

    Director

    • Tenure: 2.2yrs
    • Compensation: US$221.21k

Company Information

Paychex, Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Paychex, Inc.
  • Ticker: PAYX
  • Exchange: NasdaqGS
  • Founded: 1979
  • Industry: Data Processing and Outsourced Services
  • Sector: Software
  • Market Cap: US$29.743b
  • Shares outstanding: 359.35m
  • Website: https://www.paychex.com

Number of Employees


Location

  • Paychex, Inc.
  • 911 Panorama Trail South
  • Rochester
  • New York
  • 14625
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
PAYXNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDAug 1983
PCXDB (Deutsche Boerse AG)YesCommon StockDEEURAug 1983
PAYXWBAG (Wiener Boerse AG)YesCommon StockATEURAug 1983

Biography

Paychex, Inc. provides integrated human capital management solutions for payroll, benefits, human resource (HR), retirement, and insurance services for small- to medium-sized businesses in the United State ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/09/18 23:37
End of Day Share Price2019/09/18 00:00
Earnings2019/05/31
Annual Earnings2019/05/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.