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Upturn AI SWOT - About
PAYX 
Paychex Inc (PAYX)
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Upturn Advisory Summary
04/01/2025: PAYX (1-star) is currently NOT-A-BUY. Pass it for now.
Upturn Star Rating
Not Recommended Performance
These Stocks/ETFs, based on Upturn Advisory, consistently fall short of market performance, signaling caution before investing.
AI Based Fundamental Rating
Moderate Performance
These Stocks/ETFs, based on Upturn Advisory, typically align with the market average, offering steady but unremarkable returns.
Analysis of Past Performance
Type Stock | Historic Profit -6.91% | Avg. Invested days 37 | Today’s Advisory PASS |
Upturn Star Rating | Upturn Advisory Performance  3.0 | Stock Returns Performance  1.0 |
| Profits based on simulation | Last Close 04/01/2025 |
Key Highlights
Company Size Large-Cap Stock | Market Capitalization 55.68B USD | Price to earnings Ratio 32.14 | 1Y Target Price 145.01 |
Price to earnings Ratio 32.14 | 1Y Target Price 145.01 | ||
Volume (30-day avg) 2352858 | Beta 0.98 | 52 Weeks Range 112.98 - 158.37 | Updated Date 04/1/2025 |
52 Weeks Range 112.98 - 158.37 | Updated Date 04/1/2025 | ||
Dividends yield (FY) 2.54% | Basic EPS (TTM) 4.81 |
Analyzing Revenue: Products, Geography and Growth
Revenue by Products
Product revenue - Year on Year
Earnings Date
Report Date 2025-03-31 | When Before Market | Estimate 1.4796 | Actual 1.49 |
Profitability
Profit Margin 31.99% | Operating Margin (TTM) 45.85% |
Management Effectiveness
Return on Assets (TTM) 11.64% | Return on Equity (TTM) 44.25% |
Valuation
Trailing PE 32.14 | Forward PE 28.99 | Enterprise Value 54944575488 | Price to Sales(TTM) 10.22 |
Enterprise Value 54944575488 | Price to Sales(TTM) 10.22 | ||
Enterprise Value to Revenue 9.87 | Enterprise Value to EBITDA 21.47 | Shares Outstanding 360191008 | Shares Floating 321815954 |
Shares Outstanding 360191008 | Shares Floating 321815954 | ||
Percent Insiders 10.6 | Percent Institutions 81.42 |
Analyst Ratings
Rating 2.89 | Target Price 137.94 | Buy - | Strong Buy 1 |
Buy - | Strong Buy 1 | ||
Hold 15 | Sell 2 | Strong Sell 1 | |
Strong Sell 1 |
Upturn AI SWOT
Paychex Inc
Company Overview
History and Background
Paychex, Inc. was founded in 1971 by B. Thomas Golisano. Initially focused on payroll processing, it expanded over time to offer a comprehensive suite of human resource, retirement, and insurance services to small and medium-sized businesses. Significant milestones include its IPO in 1983 and continuous expansion of its service offerings through organic growth and acquisitions.
Core Business Areas
- Management Solutions: Provides payroll processing, payroll tax administration, employee payment services, and HR administration services.
- Professional Employer Organization (PEO): Offers comprehensive HR outsourcing solutions, including HR management, benefits administration, payroll services, and risk management.
Leadership and Structure
The CEO is John B. Gibson. The organizational structure is hierarchical, with functional departments such as Sales, Marketing, Operations, and Technology. A Board of Directors provides oversight.
Top Products and Market Share
Key Offerings
- Payroll Services: Paychex's core offering, providing payroll processing, tax filing, and compliance services. It holds a significant market share in the small-to-medium-sized business segment. ADP and Intuit are major competitors. Revenue attributed is part of the Management Solutions segment, unable to break down.
- HR Solutions: Includes HR administration, benefits administration, time and attendance tracking, and recruiting services. ADP, Insperity, and TriNet are key competitors. Revenue attributed is part of the Management Solutions segment, unable to break down.
- PEO Services: Comprehensive HR outsourcing for small and medium-sized businesses. Competitors include Insperity, TriNet, and ADP TotalSource. Revenue attributed is unable to break down.
Market Dynamics
Industry Overview
The HR outsourcing and payroll processing industry is mature and competitive, characterized by increasing demand for integrated solutions and technological advancements. The industry is growing, driven by increasing compliance requirements and the need for businesses to focus on core competencies.
Positioning
Paychex is a leading provider of payroll and HR solutions, particularly focused on small to medium-sized businesses. Its competitive advantages include its established brand, comprehensive service offerings, and strong distribution network.
Total Addressable Market (TAM)
The global HR technology market is projected to reach hundreds of billions of dollars. Paychex is well-positioned to capture a significant share of this market, given its focus on the SMB sector.
Upturn SWOT Analysis
Strengths
- Strong brand recognition
- Extensive client base
- Comprehensive service offerings
- Established distribution network
- Recurring revenue model
Weaknesses
- Reliance on small businesses, making it susceptible to economic downturns
- Competition from larger players with broader service offerings
- Potential for technological disruption from newer, more agile competitors
- Lower profit margins compared to some competitors
- Concentrated revenue from payroll segment
Opportunities
- Expansion into new geographic markets
- Development of new integrated HR technology solutions
- Strategic acquisitions to expand service offerings
- Increased adoption of cloud-based solutions
- Growth in the gig economy driving demand for payroll solutions
Threats
- Increased competition from established players and new entrants
- Economic downturns impacting small businesses
- Changes in government regulations regarding payroll and HR
- Data security and privacy concerns
- Technological obsolescence
Competitors and Market Share
Key Competitors
- ADP (ADP)
- Intuit (INTU)
- Insperity (NSP)
Competitive Landscape
Paychex competes primarily with ADP and Intuit. ADP has a broader range of services. Paychex's advantage is its focus on small businesses. Intuit is strong in accounting software.
Major Acquisitions
FLSA Analytics
- Year: 2023
- Acquisition Price (USD millions): 17
- Strategic Rationale: FLSA Analytics technology strengthens Paychex's position as a leading provider of HR solutions to help businesses navigate the complexities of wage and hour regulations.
Growth Trajectory and Initiatives
Historical Growth: Paychex has experienced consistent growth in revenue and earnings over the past decade, driven by organic growth and strategic acquisitions.
Future Projections: Analysts project continued growth for Paychex, driven by increasing demand for HR outsourcing solutions and its expansion into new markets.
Recent Initiatives: Recent strategic initiatives include investments in technology, expansion of its service offerings, and acquisitions of complementary businesses.
Summary
Paychex is a strong and stable company in the HR and payroll services industry. Its focus on small and medium-sized businesses and recurring revenue model provide a solid foundation. However, Paychex needs to be mindful of competition and technological advancements while sustaining its growth trajectory.
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Sources and Disclaimers
Data Sources:
- Paychex Investor Relations
- SEC Filings (10-K, 10-Q)
- Market Research Reports
- Analyst Reports
Disclaimers:
This analysis is based on available information and is not financial advice. Market conditions and company performance can change rapidly. Consult with a qualified financial advisor before making investment decisions.
AI Summarization is directionally correct and might not be accurate.
Summarized information shown could be a few years old and not current.
Fundamental Rating based on AI could be based on old data.
AI-generated summaries may have inaccuracies (hallucinations). Please verify the information before taking action.
About Paychex Inc
Exchange NASDAQ | Headquaters Rochester, NY, United States | ||
IPO Launch date 1990-03-26 | President, CEO & Director Mr. John B. Gibson Jr. | ||
Sector Technology | Industry Software - Application | Full time employees 16500 | Website https://www.paychex.com |
Full time employees 16500 | Website https://www.paychex.com | ||
Paychex, Inc., together with its subsidiaries, provides integrated human capital management solutions (HCM) for payroll, benefits, human resources (HR), and insurance services for small to medium-sized businesses in the United States, Europe, and India. It offers payroll processing services; payroll tax administration services; employee payment services; and regulatory compliance services, such as new-hire reporting and garnishment processing. The company also provides HR solutions, including integrated HCM technology solutions and HR advisory services through both virtual and on-site availability of a professionally trained HR representative, as well as HR support to non-payroll clients through its HR Partner Plus solution; and retirement services administration, such as plan implementation, ongoing compliance with government regulations, employee and employer reporting, participant and employer online access, electronic funds transfer, and other administrative services. In addition, it offers cloud-based HR administration software products for employee benefits management and administration, time and attendance, digital communication solutions, recruiting, and onboarding solutions; plan administration outsourcing and state unemployment insurance services; various business services to small to medium-sized businesses comprising payroll funding and outsourcing services, which include payroll processing, invoicing, and tax preparation; and payment processing services, financial fitness programs, and a small-business loan resource center. Further, the company provides insurance services for property and casualty coverage, such as workers' compensation, business-owner policies, cyber security protection, and commercial auto, as well as health and benefits coverage, including health, dental, vision, and life. It markets and sells its services primarily through its direct sales force. The company was founded in 1971 and is headquartered in Rochester, New York.
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