A Peek at Paychex's Future Earnings

Paychex PAYX is set to give its latest quarterly earnings report on Wednesday, 2025-06-25. Here's what investors need to know before the announcement.

Analysts estimate that Paychex will report an earnings per share (EPS) of $1.19.

Anticipation surrounds Paychex's announcement, with investors hoping to hear about both surpassing estimates and receiving positive guidance for the next quarter.

New investors should understand that while earnings performance is important, market reactions are often driven by guidance.

Past Earnings Performance

Last quarter the company beat EPS by $0.01, which was followed by a 1.09% increase in the share price the next day.

Here's a look at Paychex's past performance and the resulting price change:

Stock Performance

Shares of Paychex were trading at $151.25 as of June 23. Over the last 52-week period, shares are up 29.37%. Given that these returns are generally positive, long-term shareholders should be satisfied going into this earnings release.

Analyst Opinions on Paychex

For investors, staying informed about market sentiments and expectations in the industry is paramount. This analysis provides an exploration of the latest insights on Paychex.

Analysts have given Paychex a total of 6 ratings, with the consensus rating being Neutral. The average one-year price target is $154.0, indicating a potential 1.82% upside.

Comparing Ratings with Competitors

The analysis below examines the analyst ratings and average 1-year price targets of Paycom Software, Paylocity Holding and Dayforce, three significant industry players, providing valuable insights into their relative performance expectations and market positioning.

• Analysts currently favor an Neutral trajectory for Paycom Software, with an average 1-year price target of $251.2, suggesting a potential 66.08% upside.
• Analysts currently favor an Outperform trajectory for Paylocity Holding, with an average 1-year price target of $230.07, suggesting a potential 52.11% upside.
• Analysts currently favor an Buy trajectory for Dayforce, with an average 1-year price target of $68.0, suggesting a potential 55.04% downside.

Peer Analysis Summary

Within the peer analysis summary, vital metrics for Paycom Software, Paylocity Holding and Dayforce are presented, shedding light on their respective standings within the industry and offering valuable insights into their market positions and comparative performance.

Key Takeaway:

In terms of consensus rating, Paychex is in the middle compared to its peers. Paychex has the highest revenue growth among its peers. Paychex also leads in gross profit. However, Paychex has the lowest return on equity compared to its peers.

All You Need to Know About Paychex

Paychex is a technology company providing human capital management solutions, enabling clients to better implement payroll, talent, time, tax, and benefits administration. It has a diverse set of product offerings addressing client needs. Aside from its traditional cloud-based payroll and HCM software offering, which accounts for close to half of total revenue, the company provides outsourcing options. Paychex's administrative service organization and professional employer organization accounts generate over 40% of sales. The balance of revenue is generated through retirement services, insurance solutions, and other products. In fiscal 2024, the company had 745,000 clients and over 2.3 million worksite employees across its ASO and PEO.

Paychex's Economic Impact: An Analysis

Market Capitalization Highlights: Above the industry average, the company's market capitalization signifies a significant scale, indicating strong confidence and market prominence.

Revenue Growth: Paychex's remarkable performance in 3 months is evident. As of 28 February, 2025, the company achieved an impressive revenue growth rate of 4.84%. This signifies a substantial increase in the company's top-line earnings. As compared to its peers, the revenue growth lags behind its industry peers. The company achieved a growth rate lower than the average among peers in Industrials sector.

Net Margin: Paychex's financial strength is reflected in its exceptional net margin, which exceeds industry averages. With a remarkable net margin of 34.41%, the company showcases strong profitability and effective cost management.

Return on Equity (ROE): Paychex's ROE surpasses industry standards, highlighting the company's exceptional financial performance. With an impressive 12.91% ROE, the company effectively utilizes shareholder equity capital.

Return on Assets (ROA): Paychex's ROA stands out, surpassing industry averages. With an impressive ROA of 4.77%, the company demonstrates effective utilization of assets and strong financial performance.

Debt Management: Paychex's debt-to-equity ratio is below the industry average at 0.21, reflecting a lower dependency on debt financing and a more conservative financial approach.

To track all earnings releases for Paychex visit their earnings calendar on our site.

This article was generated by Benzinga's automated content engine and reviewed by an editor.