NEW YORK, April 15, 2025 /PRNewswire/ -- As U.S. businesses face growing challenges sourcing skilled talent locally, Paychex, a leading provider of HR and payroll services, and Multiplier, a global employment platform, today announced a strategic partnership to help U.S. businesses scale globally with confidence. As part of the collaboration, Multiplier is now a Premium Partner in the Paychex Marketplace — helping Paychex customers find a trusted solution for compliant global hiring. Talent shortages across ...

Human capital management (HCM) firm Paychex has announced its acquisition of Paycor HCM, a software company providing HCM, payroll and talent services.The acquisition will help the company offer “the most comprehensive HCM portfolio in the industry, enabling Paychex to better meet the needs of new and existing customers across all market segments,” the companies said in a Monday (April 14) news release. “This transaction strengthens our competitive position upmarket, unlocks new revenue opportunities, and p ...

Joseph Jones, professor at The University of Southern Mississippi, has over fifteen years of experience studying the market. He focuses on portfolio construction from a dividend growth investor's perspective. The insights expressed in his research are solely his own; they do not represent the views or financial interests of his employer.Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the nex ...

Paychex Inc. NASDAQ: PAYX and Cintas Corp. NASDAQ: CTAS are two prominent business services stocks. They serve as bellwethers of the labor market. At a time when investors are filled with uncertainty surrounding the economy, both companies delivered solid earnings reports that suggest the labor market may be stronger than it may seem to people on Main Street. Get Cintas alerts: Paychex Expects Growth Through Acquisition Paychex is a leader in providing human capital management (HCM) solutions for small- and ...

Paychex Paychex Today PAYX $151.03 -0.80 (-0.53%) 52-Week Range $114.72 ▼ $158.37 Dividend Yield 2.60% P/E Ratio 31.80 Price Target $137.58 Add to Watchlist In 2025, investors can get paid to own Paychex NASDAQ: PAYX. The company pays a healthy dividend, and its share prices are set to reach new records. Up 7% for the year at the end of Q1, this market can rise another 7% in Q2 and set itself up for a sustained rally in the back half of the year. Dividend Yield 2.60% Annual Dividend $3.92 Annualized 3-Year ...

Third Quarter Highlights and Financial Results Fiscal 2025 Copyright 2025, Paychex, Inc. All rights reserved. Forward Looking Statements Certain written statements in this presentation may contain, and members of management may from time to time make or discuss statements which constitute, "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, all matters that are not ...

Core Insights - Paychex reported $1.51 billion in revenue for the quarter ended February 2025, marking a year-over-year increase of 4.8% and an EPS of $1.49 compared to $1.38 a year ago, with a revenue surprise of +0.03% and an EPS surprise of +0.68% over consensus estimates [1] Financial Performance - Average investment balance for funds held for clients was $5.12 billion, exceeding the estimated $4.98 billion [4] - Average interest rates earned on funds held for clients stood at 3.4%, matching the average estimate [4] - Average investment balance for corporate cash equivalents and investments was $1.54 billion, slightly above the $1.50 billion estimate [4] - Average interest rates earned on corporate cash equivalents and investments were 4.3%, below the estimated 4.5% [4] - Revenue from interest on funds held for clients was $42.90 million, surpassing the average estimate of $40.82 million, but reflecting a year-over-year decline of -2.3% [4] - Total service revenue was reported at $1.47 billion, consistent with the average estimate and showing a year-over-year increase of +5.1% [4] - Revenue from PEO and Insurance Services was $365.40 million, slightly below the average estimate of $371.35 million, with a year-over-year increase of +5.8% [4] - Revenue from Management Solutions was $1.10 billion, aligning with the average estimate and reflecting a year-over-year change of +4.8% [4] Stock Performance - Paychex shares have returned -4.6% over the past month, compared to a -2.9% change in the Zacks S&P 500 composite [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Financial Performance - Total service revenue for the three months ended February 28, 2025, was $1,466.1 million, a 5% increase from $1,395.4 million in the prior year[106] - Net income for the nine months ended February 28, 2025, reached $1,360.1 million, reflecting a 4% increase compared to $1,310.5 million in the prior year[106] - Adjusted diluted earnings per share for the three months ended February 28, 2025, was $1.49, an 8% increase from $1.38 in the prior year[106] - Operating income for the nine months ended February 28, 2025, was $1,776.6 million, a 5% increase from $1,692.3 million in the prior year[106] - Total revenue for the three months ended February 28, 2025, was $1,509.0 million, a 5% increase from $1,439.3 million in the prior year[106] - Net income for Q3 2025 was $519.3 million, reflecting a 4% increase from $498.6 million in Q3 2024[120] - Adjusted diluted earnings per share rose to $1.49, an 8% increase from $1.38 in Q3 2024[120] - EBITDA for Q3 2025 was $734.9 million, a 6% increase from $694.6 million in Q3 2024[120] Revenue Breakdown - Management Solutions revenue for the three months ended February 28, 2025, was $1,100.7 million, a 5% increase from $1,049.9 million in the prior year[107] - Management Solutions revenue was $1.1 billion for Q3 2025, up 5%, and $3.0 billion for the nine months, up 3%[111] - PEO and Insurance Solutions revenue reached $365.4 million for Q3 2025, a 6% increase, and $1.0 billion for the nine months, a 7% increase[111] Expenses and Income - Total expenses increased 4% to $817.2 million for Q3 2025 and 3% to $2.4 billion for the nine months[112] - Operating income rose 6% to $691.8 million for Q3 2025 and 5% to $1.8 billion for the nine months[114] - Adjusted operating income increased 9% to $708.5 million for Q3 2025 and 6% to $1.8 billion for the nine months[114] Tax and Dividends - The effective income tax rate for the three months ended February 28, 2025, was 24.3%, slightly down from 24.4% in the prior year[107] - Dividends paid to stockholders increased by 10% to $353.0 million for the three months ended February 28, 2025, compared to $320.4 million in the prior year[106] Acquisition Plans - The company plans to acquire Paycor for $4.1 billion, with the transaction expected to close in April 2025[104] - The company entered into a definitive agreement to acquire Paycor for $22.50 per eligible share, with the acquisition expected to close in April 2025[138] - Acquisition-related costs amounted to $16.7 million in Q3 2025, primarily related to the pending Paycor acquisition[117] - Acquisition-related costs recognized for the Paycor acquisition were $16.7 million for Q3 2025[120] Cash Flow and Investments - For the nine months ended February 28, 2025, net cash provided by operating activities was $1,557.1 million, a decrease of $118.9 million compared to the prior year[142] - The company reported net cash used in investing activities of $281.7 million for the nine months ended February 28, 2025, an increase of $163.9 million compared to the prior year[142] - Total corporate investments, including cash and restricted cash, amounted to $1.7 billion as of February 28, 2025[124] - The company has $2.0 billion in unused capacity under unsecured credit facilities as of February 28, 2025[124] - A Bridge Loan Commitment of up to $3.5 billion was established for the acquisition of Paycor, with no borrowings under this commitment as of February 28, 2025[132] Interest Rates and Risks - Average interest rates earned on funds held for clients were 3.4% for Q3 2025, down from 3.5% in the prior year[109] - The average interest rate earned on combined funds held for clients and corporate cash equivalents was 3.7% for the nine months ended February 28, 2025, compared to 3.8% for the prior year[150] - Company is exposed to interest rate risk through recurring credit facilities, which could lead to increased interest expenses if rates rise[160] - As of February 28, 2025, $2.1 billion of AFS securities had fair values below amortized cost, with gross unrealized losses of $79.1 million attributed to interest rate changes[161] Financial Monitoring and Accounting - The company maintains an ongoing monitoring system for financial institutions to minimize potential risk exposure to cash and investment balances[163] - There have been no material changes in critical accounting policies and estimates used to prepare consolidated financial statements[164] - Recent accounting pronouncements have been adopted and discussed in the Notes to Consolidated Financial Statements[165] - Market risk factors are detailed under Management's Discussion and Analysis of Financial Condition and Results of Operations[166] - Key accounting estimates include revenue recognition, goodwill, and impairment of long-lived assets[167]

Paychex, Inc. (NASDAQ:PAYX) Q3 2025 Results Conference Call March 26, 2025 9:30 AM ET Company Participants Bob Schrader - Chief Financial Officer John Gibson - Chief Executive Officer Conference Call Participants Daniel Maxwell - William Blair Mark Marcon - Baird Pete Christiansen - Citi Jared Levine - TD Cowen Bryan Keane - Deutsche Bank Ramsey El-Assal - Barclays James Faucette - Morgan Stanley Will Qi - RBC Capital Markets Kartik Mehta - Northcoast Research Tien-Tsin Huang - JPMorgan Samad Samana - Jeffe ...

Core Viewpoint - Paychex reported mixed earnings results, with a slight beat on earnings per share but a miss on sales, while the stock price increased significantly despite concerns about future profitability [1][2][4]. Group 1: Earnings Performance - Paychex's sales grew by 5% year over year in Q3, while adjusted earnings per share increased by 8%, exceeding expectations [2]. - GAAP earnings per share rose by only 4% to $1.43, indicating slower growth compared to the adjusted figures [2]. Group 2: Acquisition Update - The waiting period for Paychex's acquisition of Paycor has expired without government objection, allowing the acquisition to proceed as planned, with a probable closing in April [3]. Group 3: Future Guidance - Management did not provide specific earnings guidance for fiscal Q4 but indicated that adjusted operating margins increased by 180 basis points to 46.9% in Q3, with expectations of a decline to around 43% in Q4 [4]. - The company maintains its previous guidance for fiscal 2025, forecasting earnings growth of 4% to 5.5% and adjusted earnings growth of 5% to 7%, along with operating margins of 42% to 43% [5][6].