Paychex Story

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PAYX -- USA Stock  

USD 87.55  1.77  1.98%

While some of us are excited about industrials space, it makes sense to break down Paychex in greater detail to make a better perception of its potential. As we have suggested previously, Paychex is beginning its slide as investors shift to be more bearish due to the increased sector volatility. The company returns are correlated to returns on the market. As market fluctuates, the company is expected to follow. Strong technical indicators of the company may also suggest signals of long term gains for Paychex investors. Paychex is scheduled to announce its earnings today. The next earnings report is expected on the 24th of March 2021.
Published over three weeks ago
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Should you acquire Paychex (NASDAQ:PAYX) based on current technical indicators?
This firm's average rating is Hold from 15 analysts. Do analysts base this consensus on technical analyses? We know that typical technical analysis utilizes price momentum, patterns, and trends looking at historical prices. It aims to identify signals based on Paychex market sentiment investors' perception of the future value of Paychex. Let us look at a few aspects of Paychex technical analysis. The company has Profit Margin (PM) of 26.26 %, which can signify that it executes well on its competitive strategies and has good control over its expenditures. This is very large. Similarly, it shows Operating Margin (OM) of 40.24 %, which suggests for every 100 dollars of sales, it generated a net operating income of 0.4.
Using predictive technical analysis, we will analyze different prices and returns patterns and diagnose historical swings to determine the real value of Paychex. In general, we focus on analyzing Paychex stock price patterns and their correlations with different microeconomic environment and drivers. We also apply predictive analytics to build Paychex's daily price indicators and compare them against related drivers such as momentum indicators and various other types of predictive indicators. Using this methodology combined with a more conventional technical analysis and fundamental analysis, we attempt to find the most accurate representation of Paychex's intrinsic value. In addition to deriving basic predictive indicators for Paychex, we also check how macroeconomic factors affect Paychex price patterns. Please read more on our technical analysis page or use our predictive modules below to complement your research.
Sophisticated investors, who have witnessed many market ups and downs, frequently view the market will even out over time. This tendency of Paychex's stock price to converge to an average value over time is called mean reversion. However, historically, high market prices usually discourage investors that believe in mean reversion to invest, while low prices are viewed as an opportunity to buy. Please use the tools below to analyze the current value of Paychex in the context of predictive analytics.
Please note, it is not enough to conduct a financial or market analysis of a single entity such as Paychex. Your research has to be compared to or analyzed against Paychex's peers to derive any actionable benefits. When done correctly, Paychex's competitive analysis will give you plenty of quantitative and qualitative data to validate your investment decisions or develop an entirely new strategy towards taking a position in Paychex.

How does Paychex Stands against Peers?

Analyzing Paychex competition or peers my help you to expand the diversification possibilities of your existing portfolios and to get a better perspective on locking in new positions. Try to analyze the advantages of investing in traded instruments related to Paychex across multiple sectors and thematic ideas. A good competitive analysis can cover a lot of different areas. But what areas to choose depends on who you are. The more exhaustive you are in your analysis, the more effective your competitive analysis will be.
Check out Paychex Competition Details

What do experts say?

Stock analysis is a method for investors and traders to make buying and selling decisions. By studying and evaluating past and current data, investors and traders attempt to gain an edge in the markets by making informed decisions. It is good to see analyst projects for Paychex, but it might be worth checking our own buy vs. sell analysis

Paychex exotic insider transaction detected

Legal trades by Paychex insiders are very common, as founders, directors, or employees of any publicly traded firm often have stock or stock options. These trades are made public in the United States through the filing of Form 4 of the Securities and Exchange Commission. Below entry was recorded recently and is publicly available as an insider trade:
Paychex insider trading alert for general transaction of stock option by Robert Schrader, VPController, on 28th of December 2020. This event was filed by Paychex Inc with SEC on 2020-12-28. Statement of changes in beneficial ownership - SEC Form 4 [view details]   
Note, although insider trading is legal, in the United States, Canada, Australia, and Germany, for mandatory reporting purposes, corporate insiders are defined as a company's officers, directors, and any beneficial owners of more than 10% of a class of the company's equity securities.

Closer look at Paychex Mean Deviation

Paychex has current Mean Deviation of 1.12. The mean deviation of the equity instrument is the first measure of the distances between each value of security historical prices and the mean. It gives us an idea of how spread out from the center the distribution of returns.

Mean Deviation is the average of the absolute values of the differences between price distribution numbers and their mean. Mean deviation of equity instrument with a lot of historical data is a biased estimator because the time horizon used in calculation will always be much smaller than the entire price history of the equity. The mean deviation is typically used as a measure of dispersion for small investment horizon, otherwise standard deviation is a better measure of dispersion.

Mean Deviation 
SUM = Summation notation
RET DEV = Sum of return deviations of Paychex
N = Number of calculation points for selected time horizon
Let's now compare Paychex Mean Deviation to its closest peers:

Another small slide for Paychex

Risk adjusted performance is down to 0.28. It may suggest a possible volatility slide. As of the 23rd of December, Paychex holds the Risk Adjusted Performance of 0.2772, semi deviation of 1.03, and Coefficient Of Variation of 394.31. Compared to fundamental indicators, the technical analysis model allows you to check existing technical drivers of Paychex, as well as the relationship between them. Put it differently, you can use this information to find out if the company will indeed mirror its model of past market data, or the prices will eventually revert. We have analyze and collected data for nineteen technical drivers for Paychex, which can be compared to its competitors. Please check Paychex standard deviation, as well as the relationship between the value at risk and kurtosis to decide if Paychex is priced some-what accurately, providing market reflects its current price of 94.4 per share. Given that Paychex has jensen alpha of 0.1789, we recommend you to check out Paychex's recent market performance to make sure the company can sustain itself at a future point.

Our Final Take On Paychex

While some other entities in the staffing & employment services industry are either recovering or due for a correction, Paychex may not be as strong as the others in terms of longer-term growth potentials. To summarize, as of the 23rd of December 2020, our overall 30 days recommendation on the company is Strong Buy. We believe Paychex is fairly valued with very low probability of financial unrest for the next two years.

About Contributor

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 Achuva Shats do not own shares of Paychex. Please refer to our Terms of Use for any information regarding our disclosure principles.

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