Jim Cramer breaks down why he's keeping an eye on shares of Paychex. ...

Financial Data and Key Metrics Changes - The company reported a solid third quarter with 6% revenue growth, 10 basis points of adjusted EBIT margin expansion, and 6% adjusted EPS growth [9][19] - Employer Services (ES) segment revenue increased by 5% on a reported and organic constant currency basis [19][21] - PEO revenue growth was 7%, exceeding expectations, supported by higher wages and strong retention [21][22] Business Line Data and Key Metrics Changes - New business bookings for Employer Services showed solid growth, particularly in U.S. offerings, while international bookings experienced softness due to macroeconomic uncertainty [10][11] - PEO revenue excluding zero margin pass-through growth was 8%, with average worksite employee growth at 2% [22] - The integration of Workforce Software is progressing well, with strong interest in time and attendance solutions [13][55] Market Data and Key Metrics Changes - The company experienced a decline in international bookings, attributed to macroeconomic uncertainty, but maintains a strong pipeline for future growth [11][30] - U.S. clients continued to hire, with pays per control growth remaining at 1% [11][20] - The company anticipates a continued focus on growth in the Latin America region following the acquisition of PEI in Mexico [14][66] Company Strategy and Development Direction - The company is focused on leading with best-in-class HCM technology and providing unmatched expertise in outsourcing [12][17] - The partnership with Fiserv is expected to enhance distribution and accelerate sales through integrated solutions [15][34] - The company aims to maintain strong client satisfaction and retention levels while investing in products and people for sustainable growth [25][73] Management's Comments on Operating Environment and Future Outlook - Management noted that while there is macroeconomic uncertainty, the underlying economic factors remain strong, with low unemployment and continued hiring [42][44] - The company expects pays per control growth to remain below normal levels in fiscal 2026 due to economic conditions [24][25] - Management remains optimistic about the strength of the pipeline and the potential for growth in the fourth quarter [30][102] Other Important Information - A CFO transition was announced, with Peter Hadley set to succeed Don McGuire effective July 1 [6][8] - The company received several awards for its HCM technology, indicating strong market recognition [17] Q&A Session Summary Question: Can you provide more color on the softer international bookings? - Management indicated that the softness is due to macroeconomic uncertainty, but strong pipelines remain for future growth [30] Question: What is the growth opportunity for the embedded offering with Fiserv? - Management expressed excitement about the partnership, highlighting the potential for significant growth through integrated solutions [34] Question: How is the company addressing client hesitancy in the current macro environment? - Management noted stability in their client base, with continued hiring and strong pipelines, despite some apprehension regarding large deals [42][44] Question: What are the expectations for PEO business in the current environment? - Management reported solid growth in PEO bookings and strong retention, indicating a positive outlook for the segment [51][52] Question: How does the company view its hiring plans in light of current conditions? - Management confirmed no changes to hiring plans, maintaining optimism about business performance [85] Question: What percentage of bookings come from international markets? - Management stated that approximately 12% of revenue comes from international markets, with the majority being domestic [113] Question: How does the company plan to manage margins going forward? - Management indicated that while some margin pressures exist, they expect to recover some costs through integration and operational efficiencies [114]