Is Buying Stock In Paychex Inc. (PAYX) A Good Move Today?

Paychex Inc. (NASDAQ:PAYX) saw a downside of -1.12% to close Monday at $117.34 after subtracting -$1.33 on the day. The 5-day average trading volume is 1,384,300 shares of the company’s common stock. It has gained $119.38 in the past week. An average of 1,734,105 shares of the company has been traded in the last 20 days, and the 50-day average volume stands at 1,372,008.

PAYX’s 1-month performance is 6.38% or $7.04 on its low of $106.55 reached on 09/28/21. The company’s shares have touched a 52-week low of $79.63 and high of $119.38, with the stock’s rally to the 52-week high happening on 10/07/21. YTD, PAYX has achieved 25.93% or $24.16. However, the current price is down -1.71%% from the 52-week high price.


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Insider Transactions

On Aug 03, 70 days have gone by since the last insider trading activity for Paychex Inc. (PAYX). Schrader Robert L. (VP/Controller) most recently sold 2,238 shares at $113.49 per share on Aug 03. This transaction cost the insider $253,991. VP/Controller, Schrader Robert L., sold 686 shares at a price of $113.82 on Aug 01. Then, on Jul 30, Director DOODY JOSEPH sold 9,615 shares at a price of $113.16 per share. This transaction amounted to $1,088,033.

Valuation Metrics

The company’s PE ratio for the last five years has touched a high of 38.88 and a low of 16.41. PAYX stock has a beta of 0.89. Moving on to other valuation ratios, the trailing price-to-sales (P/S) ratio is 10.05 while the price-to-book (PB) in the most recent quarter is 13.89, with the price to cash flow ratio at 84.96.

Paychex Inc. pays an annual dividend of $2.64 per share. Its dividend yield is 2.25% and the payout ratio is 75.60%. PAYX’s most recent quarterly dividend payment was made on Aug. 26, when it paid $0.66 a share compared with prior rate of $0.66, down 0.0% from last year’s. The company has boosted its dividend for the last 1 consecutive years with the latest dividend increase of $0.04 reported on Friday April 30 2021. Measured over the last 3 years, the Dividend has been growing by 29.17% yearly.

It is projected that Paychex Inc.’s next ex-dividend date will be on 1-Nov. PAYX is expected to distribute $0.66 as its next dividend.

Paychex Inc.’s quick ratio for the period ended August 30 was 1.30, with the current ratio over the same period at 1.30 meaning that PAYX stock is able to fulfill its debt obligations. As well, the company’s long term debt to equity for the quarter ending August 30 was 0.26, while the total debt to equity was 0.26The trailing 12-month EBITDA margin is 40.74% while for the period ending August 30; Paychex Inc.’s operating margin was 38.50%. The firm’s gross profit as reported stood at $2.79 billion against revenue of $4.06 billion.

Earnings Surprise

For the quarterly period ending August 30 this year, Paychex Inc.’s cash and short-term investments amounted to $39.6 million against total debt of $897.1 million. Net income and sales went up compared to those figures reported in the previous quarter. Analysts expected PAYX to announce $0.8 per share in earnings in its latest quarter, but it posted $0.89, representing a 11.20% surprise. EBITDA for the quarter stood at more than $545.6 million. PAYX stock balance sheet for the quarter ending August 30 shows that total liabilities totaled 6.32 billion, with total debt at $897.1 million. Shareholders hold equity totaling $360.59 million

Technical Picture

Let’s look briefly at Paychex Inc. (PAYX) price momentum from a technical analysis perspective. The 9-day relative strength index as at close on 11 October was 67.70% to suggest the stock is trending Neutral, with historical volatility in this time period at 21.56%.

The stock’s 5-day moving average is $117.90, reflecting a +2.03% or $2.33 change from its current price. PAYX is currently trading +7.21% above its 20-day SMA, +18.66% above its 100-day SMA. However, the stock’s current price level is away from the SMA50 and SMA200 by +3.09% and +24.30% respectively.

Stochastic %K and %D was 90.93% and 94.36% and the average true range (ATR) pointed at 2.13. The RSI (14) points at 64.55%, while the 14-day stochastic is at 84.10% with the period’s ATR at 2.02. The stock’s 9-day MACD Oscillator is pointing at 2.66 and 4.99 on the 14-day charts.

Analyst Ratings

In the most recent analyst report for Paychex Inc. (NASDAQ: PAYX), Citigroup downgraded it to a Neutral rating. They previously had a Buy rating on the stock. Analysts offering their rating for PAYX stock have a consensus rating for the stock as Hold. Currently, 2 brokerage advisors rate PAYX as a “sell,”, while 17 advise that investors “Hold.” 1 analysts have rated the stock as underweight. 0 rates the stock as overweight while 2 have offered a “buy” rating.

What is PAYX’s price target for the next 12 months?

Analysts have a consensus price target ranging from a low of $97.00 and a high of $135.00, with their median price target at $118.00. Looking at these predictions, the average price target given by analysts is for Paychex Inc. (PAYX) stock is $116.71.

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