Paychex (NASDAQ:PAYX) Downgraded by Morgan Stanley

Morgan Stanley cut shares of Paychex (NASDAQ:PAYX) from an equal weight rating to an underweight rating in a research report report published on Thursday morning, 24/7 WallStreet reports. They currently have $74.00 target price on the business services provider’s stock, down from their previous target price of $77.00.

A number of other brokerages have also recently issued reports on PAYX. Bank of America cut Paychex from a neutral rating to an underperform rating in a research note on Wednesday, June 26th. They noted that the move was a valuation call. William Blair reiterated a market perform rating on shares of Paychex in a research note on Thursday, June 27th. BidaskClub upgraded Paychex from a hold rating to a buy rating in a research note on Wednesday, July 31st. Finally, Sanford C. Bernstein cut Paychex from a market perform rating to an underperform rating in a research note on Tuesday, April 30th. Three analysts have rated the stock with a sell rating, nine have issued a hold rating and two have given a buy rating to the company. The company presently has a consensus rating of Hold and an average price target of $76.09.

NASDAQ PAYX opened at $81.47 on Thursday. The stock has a market capitalization of $28.78 billion, a price-to-earnings ratio of 28.69, a PEG ratio of 2.88 and a beta of 0.86. The stock’s 50 day moving average price is $84.29 and its two-hundred day moving average price is $82.00. The company has a debt-to-equity ratio of 0.30, a quick ratio of 1.17 and a current ratio of 1.17. Paychex has a 52 week low of $61.32 and a 52 week high of $88.43.

Paychex (NASDAQ:PAYX) last released its earnings results on Wednesday, June 26th. The business services provider reported $0.63 EPS for the quarter, missing the Thomson Reuters’ consensus estimate of $0.65 by ($0.02). The firm had revenue of $980.40 million during the quarter, compared to the consensus estimate of $978.94 million. Paychex had a net margin of 27.42% and a return on equity of 40.99%. The company’s revenue was up 15.9% on a year-over-year basis. During the same quarter in the previous year, the firm posted $0.61 EPS. On average, equities research analysts forecast that Paychex will post 3.09 EPS for the current year.

The business also recently disclosed a quarterly dividend, which will be paid on Thursday, August 22nd. Stockholders of record on Thursday, August 1st will be paid a dividend of $0.62 per share. This represents a $2.48 dividend on an annualized basis and a dividend yield of 3.04%. The ex-dividend date of this dividend is Wednesday, July 31st. Paychex’s dividend payout ratio is currently 87.32%.

In related news, insider Stephanie L. Schaeffer sold 1,791 shares of the stock in a transaction on Saturday, July 6th. The stock was sold at an average price of $85.31, for a total value of $152,790.21. Following the sale, the insider now owns 46,355 shares in the company, valued at approximately $3,954,545.05. The transaction was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. Also, CFO Efrain Rivera sold 476 shares of the stock in a transaction on Friday, July 12th. The shares were sold at an average price of $85.72, for a total value of $40,802.72. Following the completion of the sale, the chief financial officer now owns 62,192 shares in the company, valued at approximately $5,331,098.24. The disclosure for this sale can be found here. In the last quarter, insiders have sold 55,996 shares of company stock worth $4,763,436. Company insiders own 11.80% of the company’s stock.

A number of institutional investors and hedge funds have recently bought and sold shares of the stock. BlackRock Inc. raised its stake in Paychex by 9.7% in the 2nd quarter. BlackRock Inc. now owns 34,524,333 shares of the business services provider’s stock valued at $2,841,008,000 after acquiring an additional 3,058,635 shares during the period. Vanguard Group Inc. raised its stake in Paychex by 1.6% in the 2nd quarter. Vanguard Group Inc. now owns 26,398,764 shares of the business services provider’s stock valued at $2,172,355,000 after acquiring an additional 425,365 shares during the period. Wells Fargo & Company MN raised its stake in Paychex by 11.0% in the 2nd quarter. Wells Fargo & Company MN now owns 9,305,194 shares of the business services provider’s stock valued at $765,725,000 after acquiring an additional 919,406 shares during the period. Invesco Ltd. raised its stake in Paychex by 1.5% in the 2nd quarter. Invesco Ltd. now owns 5,849,907 shares of the business services provider’s stock valued at $481,389,000 after acquiring an additional 85,215 shares during the period. Finally, Northern Trust Corp raised its stake in Paychex by 2.1% in the 1st quarter. Northern Trust Corp now owns 5,676,852 shares of the business services provider’s stock valued at $455,285,000 after acquiring an additional 117,877 shares during the period. Institutional investors and hedge funds own 69.85% of the company’s stock.

Paychex Company Profile

Paychex, Inc provides payroll, human resource (HR), retirement, and insurance services for small to medium-sized businesses in the United States and Europe. The company offers payroll processing services; payroll tax administration services; employee payment services; and regulatory compliance services, such as new-hire reporting and garnishment processing.

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