Paychex, Inc. (NASDAQ:PAYX) Plans Quarterly Dividend of $0.98

Paychex, Inc. (NASDAQ:PAYX) announced a quarterly dividend on Thursday, May 2nd, Wall Street Journal reports. Stockholders of record on Friday, May 10th will be paid a dividend of 0.98 per share by the business services provider on Thursday, May 30th. This represents a $3.92 dividend on an annualized basis and a dividend yield of 3.31%. The ex-dividend date is Thursday, May 9th. This is an increase from Paychex’s previous quarterly dividend of $0.89.

Paychex has raised its dividend by an average of 11.7% annually over the last three years and has raised its dividend annually for the last 13 consecutive years. Paychex has a dividend payout ratio of 67.3% indicating that its dividend is sufficiently covered by earnings. Equities analysts expect Paychex to earn $4.97 per share next year, which means the company should continue to be able to cover its $3.56 annual dividend with an expected future payout ratio of 71.6%.

Paychex Price Performance

Paychex stock traded down $0.96 during mid-day trading on Thursday, hitting $118.45. The stock had a trading volume of 1,465,760 shares, compared to its average volume of 1,802,732. Paychex has a one year low of $104.09 and a one year high of $129.70. The company has a current ratio of 1.24, a quick ratio of 1.24 and a debt-to-equity ratio of 0.21. The firm has a market capitalization of $42.64 billion, a P/E ratio of 26.02, a P/E/G ratio of 3.35 and a beta of 0.93. The firm’s 50 day moving average is $121.69 and its 200 day moving average is $120.40.

Paychex (NASDAQ:PAYX) last released its quarterly earnings data on Tuesday, April 2nd. The business services provider reported $1.38 earnings per share (EPS) for the quarter, beating the consensus estimate of $1.37 by $0.01. Paychex had a net margin of 31.86% and a return on equity of 46.14%. The firm had revenue of $1.44 billion for the quarter, compared to analysts’ expectations of $1.46 billion. During the same quarter last year, the business posted $1.29 earnings per share. The company’s revenue for the quarter was up 4.2% compared to the same quarter last year. On average, sell-side analysts forecast that Paychex will post 4.71 earnings per share for the current fiscal year.

Paychex announced that its Board of Directors has initiated a stock buyback program on Friday, January 19th that permits the company to buyback $400.00 million in outstanding shares. This buyback authorization permits the business services provider to purchase up to 0.9% of its shares through open market purchases. Shares buyback programs are generally a sign that the company’s board of directors believes its shares are undervalued.

Wall Street Analysts Forecast Growth

PAYX has been the topic of several recent research reports. Bank of America upped their target price on shares of Paychex from $108.00 to $111.00 and gave the company an “underperform” rating in a research report on Wednesday, April 3rd. TD Cowen lowered their price objective on Paychex from $122.00 to $121.00 and set a “hold” rating for the company in a research note on Wednesday, April 3rd. Royal Bank of Canada reiterated a “sector perform” rating and issued a $130.00 target price on shares of Paychex in a report on Wednesday, April 3rd. Evercore ISI restated an “in-line” rating and set a $118.00 price target on shares of Paychex in a report on Tuesday, March 26th. Finally, Wedbush reaffirmed a “neutral” rating and set a $115.00 price objective on shares of Paychex in a research note on Wednesday, April 3rd. Two investment analysts have rated the stock with a sell rating and ten have issued a hold rating to the company. According to MarketBeat, the company currently has a consensus rating of “Hold” and a consensus price target of $123.00.

Paychex Company Profile

Paychex, Inc provides integrated human capital management solutions for human resources (HR), payroll, benefits, and insurance services for small to medium-sized businesses in the United States, Europe, and India. It offers payroll processing services; payroll tax administration services; employee payment services; and regulatory compliance services, such as new-hire reporting and garnishment processing.