These numbers are from their second quarter highlights which can be found on a recent 8-K report. Total revenue increased 7 percent to $771.4 million and total service revenue increased 7 percent to $760.0 million. Payroll services revenue increased 3 percent to $440.9 million and human resource services revenue increased 12 percent to $319.1 million. As a current or potential investor, these are solid growth numbers for the quarter and should get you excited about the future of the company. Keep in mind however that this could all stop on a dime so be sure to consider the risks the company outlines in the 10-K report.
Switching over to the chart, we’ll take a look at the monthly time frame to get a look at the larger picture the stock has painted. Right now, price is around the all time highs creating a double top. Now is a crucial time for price because it needs to breakout with volume if it plans to run higher. On the other side, if volume is lighter, that could signal momentum is slowing and buyers are no longer interested at that price. Either way, be sure to pay close attention at this price level and use it in conjunction with fundamental analysis.
Typically, a company's
financial statements are the reports that show the
financial position of the company. There are three main documents that fall into the category of financial statements. These documents include Paychex income statement, its balance sheet, and the statement of cash flows. Potential Paychex investors and stakeholders use financial statements to determine how well the company is positioned to perform in the future. Although Paychex investors may use each financial statement separately, they are all related. The changes in Paychex's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on Paychex's income statement, which results in the company's gains or losses. Cash flows can provide more information regarding cash listed on a balance sheet, but not equivalent to net income shown on the income statement. Please read more on our
technical analysis and
fundamental analysis pages.
The goal of Paychex
fundamental analysis is to do accurate financial forecasts. There are several possible objectives to fundamental analysis, such as projecting of Paychex performance into the future periods or doing a reasonable stock valuation. The intrinsic value of Paychex shares is the value that is considered the true value of the share. If
the intrinsic value of Paychex is higher than its market price, buying is generally recommended. If it is equal to the market price, it is recommended to hold; and if it is less than the market price, then one should sell all shares Paychex. Please read more on our
fundamental analysis page.
How effective is Paychex in utilizing its assets?
Paychex reports assets on its Balance Sheet. It represents the amount of Paychex resources that either has an existing economic value or will provide some form of benefits in the future. By effectively utilizing its assets, Paychex aims to generate revenue, control costs, drive operational efficiency, and enhance profitability. Optimizing asset utilization helps maximize shareholder value and maintain a competitive position in the Human Resource & Employment Services space. To get a better handle on how balance sheet or income statements item affect Paychex volatility, please check the breakdown of all its
fundamentals.
Are Paychex Earnings Expected to grow?
The
future earnings power of Paychex involves the interaction of many company-specific, industry, and economic forces. Earnings estimates embody investors' opinions of Paychex factors such as sales growth, product demand, competitive industry environment, profit margins, and cost controls. Paychex
stock prices adjust as these expectations change or are proven wrong. The main thing to remember is that equities with high expected earnings growth tend to underperform the market because it is usually difficult to meet the market's high expectations. Companies with low earnings expectations tend to do better than expected. Please use our latest analysis of Paychex
expected earnings.
And What about dividends?
A dividend is the distribution of a portion of Paychex earnings, decided and managed by the company's board of directors and paid to a class of its shareholders. Note, announcements of dividend payouts are generally accompanied by a proportional increase or decrease in a company's stock price. Paychex dividend payments follow a chronological order of events, and the associated dates are important to determine the shareholders who qualify for receiving the dividend payment. Paychex one year expected dividend income is about USD2.54 per share.
At this time, Paychex's
Dividends Paid is fairly stable compared to the past year.
Dividend Paid And Capex Coverage Ratio is likely to rise to 1.56 in 2024, whereas
Dividend Yield is likely to drop 0.02 in 2024.
Investing in dividend-paying stocks, such as Paychex is one of the few strategies that are good for long-term investment. Ex-dividend dates are significant because investors in Paychex must own a stock before its ex-dividend date to receive its next dividend.
This type of analysis is very useful when you want to generate a past dividend schedule and payout information for Paychex. Then that information in the form of graph and calendar can be used to fully explain how Du Pont dividends can provide a real clue to its valuation.
Details
Risks
Being in the payroll and HR services sector, this has a set of risks that are slightly different than the normal risks. The company’s latest 10-K report will have a full set of risks and details, but here are a couple to keep in mind while completing your research. First, their services could be impacted by regulations and other government actions. These risks might be out of your control, but you have to take them into account while you making a decision. Secondly, the company has to be able to keep up with the changes in technology, otherwise a competitor could gain an advantage and begin taking market share away from Paychex.
Conclusion
This type of company is certainly one to keep in mind while you’re building a portfolio because they have the ability to add value, but this certainly is on an individual basis. If you’re having trouble deciding, be sure to reach out to an investing professional as they can help point you in the right direction.
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Nathan Young is a Senior Member of Macroaxis Editorial Board - US Equity Analysis. With years of experience in the financial sector, Nathan brings a diverse base of knowledge. Specifically, he has in-depth understanding of application of technical and fundamental analysis across different equity instruments. Utilizing SEC filings and technical indicators, Nathan provides a reputable analysis of companies trading in the United States.
View Profile This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Nathan Young do not own shares of Paychex. Please refer to our
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