- Paychex reported adjusted earnings per share (EPS) of $1.26 for the second quarter, surpassing last year’s $1.14 and exceeding the estimate of $1.23.
- Total revenue reached $1.56 billion, marking an 18% increase from the previous year and slightly surpassing the estimate of $1.55 billion.
- Revenue from management solutions was reported at $1.2 billion, a 25% increase year-over-year, beating the forecasted $1.18 billion.
- PEO and Insurance Solutions revenue came in at $336.9 million, showing a 6% increase year-over-year, and outpacing the estimated $331.4 million.
- The funds held for clients totaled $54.3 million, growing by 50% compared to the previous year and exceeding the expected $45.1 million.
- Operating income rose by 6.3% year-over-year to $571.9 million.
- Paychex forecasts a 10% to 11% increase in adjusted EPS for the year 2026.
- The company has raised its full-year earnings outlook.
- Analyst recommendations include 1 buy, 14 holds, and 3 sells for Paychex stock.
Paychex Inc on Smartkarma
Analysts on Smartkarma have differing opinions on Paychex Inc. Baptista Research, in their report titled “Paychex Inc.: PEO & ASO Expansion & Key Growth Catalysts That Are Driving Our Optimism!”, expressed bullish sentiment towards the company. They highlighted Paychex’s strong start to fiscal year 2026, with a 17% revenue increase and 5% growth in adjusted diluted earnings per share in the first quarter. This positive performance was attributed to successful integration with Paycor and continued demand for Paychex’s human capital management solutions in a challenging economic environment.
However, Value Investors Club (VIC) took a bearish stance on Paychex in their report published on Sunday, Jun 8, 2025. VIC highlighted risks faced by Paychex, including high valuation, decreasing demand, and increasing competition in a slowing market. They pointed out a slowdown in new business applications that could impact Paychex’s future performance negatively. These contrasting viewpoints provide investors with valuable insights to consider when evaluating their investment decisions regarding Paychex Inc.
A look at Paychex Inc Smart Scores
| Factor | Score | Magnitude |
|---|---|---|
| Value | 2 | |
| Dividend | 4 | |
| Growth | 3 | |
| Resilience | 3 | |
| Momentum | 3 | |
| OVERALL SMART SCORE | 3.0 |
Smart Score is a compound score for the Company indicating its overall outlook. It is derived by taking an equally weighted average of underlying Factor scores computed by Smartkarma
Paychex Inc has received a mixed bag of Smartkarma Smart Scores for various aspects of its overall outlook. Their Value score came in at a 2, which suggests some room for improvement in this area. On the brighter side, the company scored a solid 4 in Dividend, indicating a strong performance in this aspect. In terms of Growth, Resilience, and Momentum, Paychex Inc scored a 3 across the board, showing a stable performance without any significant spikes or declines in these areas.
As a company, Paychex, Inc. specializes in providing payroll and integrated human resource solutions for small to medium-sized businesses in the United States. Their services include everything from payroll calculations and tax filings to managing retirement plans and workers’ compensation. With a mixed bag of scores in different categories, Paychex Inc appears to have strengths in areas like dividend payments while potentially needing to focus on enhancing its overall value proposition for investors.
Disclaimer: This article by Smartkarma is general in nature and based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Note that our articles may not factor in the latest price-sensitive company announcements or qualitative material.
While all reasonable care has been taken in the preparation, Smartkarma makes no assurance about the accuracy of any generated data or content. All content is indicative only and should be independently checked for accuracy and confirmed before use. Smartkarma accepts no responsibility for any loss or damage caused as a result of any inaccuracy or error within the Lab online tools or generated data.
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