PAYX Stock Analysis: Paychex | NASDAQ
Software - Application | NASDAQ, USA | Market Cap: 39.738m USD | 12M Return: -8.7% | US7043261079 | Charts, Fundamentals & Technical Analysis
Avg Turnover: 338M
EPS Trend: 98.8%
Qual. Beats: 0
Rev. Trend: 96.5%
Qual. Beats: 0
Warnings
No concerns identified
Tailwinds
No distinct edge detected
Seasonality 11.7 years of data
How good or bad each month usually is (without trend). The score below shows how much you can trust it: 0 = pure chance, >40 gets interesting and >55 is strong.
Paychex, Inc. (NASDAQ: PAYX) is a Rochester, New York-based provider of human capital management (HCM) solutions serving small and medium-sized businesses across the United States, Europe, Canada, India, and Israel. Founded in 1971 and publicly traded since 1990, the company operates as a large-cap stock within the GICS Industrials sector, specifically the Human Resource & Employment Services sub-industry.
Paychex delivers a broad portfolio of services spanning payroll processing, payroll tax administration, HR, employee benefits administration, retirement plan administration, talent acquisition and management, workforce management, and insurance (including property and casualty, workers compensation, health, dental, vision, and life coverage). The company also operates a digital marketplace offering earned-wage access and financial wellness products, and provides HR outsourcing through administrative services organization (ASO) solutions.
The business model is anchored in recurring, subscription-based revenue from SMB clients, with services sold primarily through a direct sales force and supported by virtually and on-site HR professionals. This recurring-revenue structure, combined with long-tenured client relationships typical of payroll and benefits administration, tends to produce relatively stable cash flows across economic cycles.
- SMB hiring trends drive core payroll and HCM revenue growth
- Client fund float income pressured as Fed cuts rates
- Dividend increases and buybacks sustain shareholder returns
| Net Income: 1.81b TTM > 0 and > 6% of Revenue |
| FCF/TA: 0.13 > 0.02 and ΔFCF/TA 1.34 > 1.0 |
| NWC/Revenue: 26.56% < 20% (prev 32.99%; Δ -6.43% < -1%) |
| CFO/TA 0.14 > 3% & CFO 2.25b > Net Income 1.81b |
| Net Debt (3.74b) to EBITDA (3.07b): 1.22 < 3 |
| Current Ratio: 1.28 > 1.5 & < 3 |
| Outstanding Shares: last quarter (356.6m) vs 12m ago -1.46% < -2% |
| Gross Margin: 74.39% > 18% (prev 72.83%; Δ 1.56% > 0.5%) |
| Asset Turnover: 40.85% > 50% (prev 34.77%; Δ 6.09% > 0%) |
| Interest Coverage Ratio: 9.87 > 6 (EBIT TTM 2.63b / Interest Expense TTM 266.4m) |
| A: 0.11 (Total Current Assets 8.09b - Total Current Liabilities 6.34b) / Total Assets 15.7b |
| B: 0.11 (Retained Earnings 1.79b / Total Assets 15.7b) |
| C: 0.16 (EBIT TTM 2.63b / Avg Total Assets 16.2b) |
| D: 0.31 (Book Value of Equity 3.71b / Total Liabilities 12.0b) |
| Altman-Z'' = 2.53 = A |
| DSRI: 1.02 (Receivables 2.34b/2.00b, Revenue 6.60b/5.79b) |
| GMI: 0.98 (GM 72.83% / 74.39%) |
| AQI: 1.04 (AQ_t 0.44 / AQ_t-1 0.42) |
| SGI: 1.14 (Revenue 6.60b / 5.79b) |
| TATA: -0.03 (NI 1.81b - CFO 2.25b) / TA 15.7b) |
| Beneish M = -2.91 (Cap -4..+1) = A |
As of October 20, 2026, the stock is trading at USD 110.75 with a total of 2,187,578 shares traded. Over the past week, the price has changed by +5.84%, over one month by -3.70%, over three months by -2.86% and over the past year by -8.66%.
Current recommended Stop Loss: 107.20 (which is 3.2% or 1.3 ATR below the current price).
Paychex has received a consensus analysts rating of 3.00. Therefore, it is recommended to hold PAYX.
- StrongBuy: 2
- Buy: 0
- Hold: 15
- Sell: 0
- StrongSell: 2
| Analysts Target Price | 113.9 | 2.9% |
P/E Trailing = 21.9744
P/E Forward = 17.5439
P/S = 6.0186
P/B = 10.0382
P/EG = 1.8455
Revenue TTM = 6.60b USD
EBIT TTM = 2.63b USD
EBITDA TTM = 3.07b USD
Long Term Debt = 4.56b USD (from longTermDebt, last fiscal year)
Short Term Debt = 22.0m USD (from shortTermDebt, last fiscal year)
Debt = 4.67b USD (from shortLongTermDebtTotal, last quarter) + Leases 52.2m
Net Debt = 3.74b USD (calculated: Debt 4.67b - CCE 934.2m)
Enterprise Value = 43.5b USD (39.7b + Debt 4.67b - CCE 934.2m)
Interest Coverage Ratio = 9.87 (Ebit TTM 2.63b / Interest Expense TTM 266.4m)
EV/FCF = 21.56x (Enterprise Value 43.5b / FCF TTM 2.02b)
FCF Yield = 4.64% (FCF TTM 2.02b / Enterprise Value 43.5b)
FCF Margin = 30.54% (FCF TTM 2.02b / Revenue TTM 6.60b)
Net Margin = 27.35% (Net Income TTM 1.81b / Revenue TTM 6.60b)
Gross Margin = 74.39% ((Revenue TTM 6.60b - Cost of Revenue TTM 1.69b) / Revenue TTM)
Gross Margin QoQ = 73.62% (prev 74.01%)
Tobins Q-Ratio = 2.78 (Enterprise Value 43.5b / Total Assets 15.7b)
Interest Expense / Debt = 5.70% (Interest Expense 266.4m / Debt 4.67b)
Taxrate = 24.07% (572.4m / 2.38b)
NOPAT = 2.00b (EBIT 2.63b * (1 - 24.07%))
Current Ratio = 1.28 (Total Current Assets 8.09b / Total Current Liabilities 6.34b)
Debt / Equity = 1.26 (Debt 4.67b / totalStockholderEquity, last quarter 3.71b)
Debt / EBITDA = 1.22 (Net Debt 3.74b / EBITDA 3.07b)
Debt / FCF = 1.85 (Net Debt 3.74b / FCF TTM 2.02b)
Total Stockholder Equity = 3.83b (last 4 quarters mean from totalStockholderEquity)
RoA = 11.17% (Net Income 1.81b / Total Assets 15.7b)
RoE = 47.11% (Net Income TTM 1.81b / Total Stockholder Equity 3.83b)
RoCE = 31.35% (EBIT 2.63b / Capital Employed (Equity 3.83b + L.T.Debt 4.56b))
RoIC = 22.16% (NOPAT 2.00b / Invested Capital 9.01b)
WACC = 5.53% (E(39.7b)/V(44.4b) * Re(5.67%) + D(4.67b)/V(44.4b) * Rd(5.70%) * (1-Tc(0.24)))
Discount Rate = 5.67% (= CAPM, Blume Beta Adj.)
Shares (quarterly) Correlation: -78.82 | Cagr: -0.64%
[DCF] Terminal Value 76.06% ; FCFF base≈1.98b ; Y1≈2.07b ; Y5≈2.37b
[DCF] Fair Price = 92.28 (EV 36.6b - Net Debt 3.74b = Equity 32.8b / Shares 356.0m; r=8.35% [WACC [floored]]; 5y FCF grow 4.89% → 2.50% )
EPS Correlation: 98.84 | EPS CAGR: 8.30% | SUE: 0.67 | # QB: 0
Revenue Correlation: 96.47 | Revenue CAGR: 10.12% | SUE: 0.00 | # QB: 0
EPS current Quarter (2026-11-30): EPS=1.28 | Chg30d=-6.10% | Revisions=-84% | Analysts=18
EPS next Quarter (2027-02-28): EPS=1.87 | Chg30d=+1.86% | Revisions=+61% | Analysts=18
EPS current Year (2027-05-31): EPS=5.96 | Chg30d=-0.25% | Revisions=-13% | GrowthEPS=+8.2% | GrowthRev=+5.4%
EPS next Year (2028-05-31): EPS=6.39 | Chg30d=-0.03% | Revisions=-31% | GrowthEPS=+7.2% | GrowthRev=+5.5%
[Analyst] Revisions Ratio: -20% (up=22, down=34)