Paychex tops analysts’ estimates for earnings and revenue in the fiscal fourth quarter

Paychex tops analysts’ estimates for earnings and revenue in the fiscal fourth quarter
Written by:
Wajeeh Khan
7th July, 18:59
Updated: 7th July, 19:01
  • Paychex tops analysts’ estimates for earnings and revenue in the fiscal fourth quarter.
  • In fiscal 2020, the firm made £3.18 billion in revenue & £2.39 of adjusted diluted EPS.
  • Paychex forecasts a 2% to 5% revenue decline & a 6% to 10% drop in EPS in fiscal 2021.
Are you looking for fast-news, hot-tips and market analysis? Sign-up for the Invezz newsletter, today.

Paychex Inc. (NASDAQ: PAYX) released its quarterly financial results on Tuesday that topped analysts’ estimates for earnings and revenue in the fiscal fourth quarter. Shares of the company remained almost flat in premarket trading on Tuesday but jumped more than 5% on market open. Paychex introduced Paycheck Protection Program loan forgiveness estimator and reporting in June.  

At £59.67 per share, Paychex is currently about 13% down year to date in the stock market after recovering from an even lower £40 per share in the last week of March. Learn more about why do prices rise and fall in the stock market.

Paychex Q4 financial results versus analysts’ estimates

According to FactSet, experts had forecast the company to print £724.84 million in revenue in the fourth quarter. Their estimate for earnings per share (EPS) was capped at 47.74 pence. In its report on Tuesday, Paychex topped both estimates posting a higher £728.10 million in revenue and 48.53 pence of adjusted earnings per share in Q4.

At £175.60 million, the human resources services provider’s net income came in lower in the recent quarter than £183.32 million in the comparable quarter of last year. Paychex’s revenue in Q4 was also branded 7% lower on a year over year basis.

CEO Martin Mucci of Paychex commented on its financial results on Tuesday and said:

“In this changing work environment, our human capital management solutions and mobility applications have enabled our clients to function and maintain their businesses while working remotely.”

At the end of the fourth quarter, the Rochester-based company boasted £800 million in cash and £638 million in debt. For fiscal 2021, the company now estimates its revenue to see a 2% to a 5% decline in its revenue. In terms of adjusted EPS, Paychex forecasts a 6% to a 10% decline in the recently started financial year.

Paychex full-year financial results for fiscal 2020

As per the American firm:

“We currently anticipate that cash, restricted cash, and total corporate investments as of May 31, 2020, along with projected operating cash flows and available short-term financing, will support our business operations, capital purchases, share repurchases, and dividend payments for the foreseeable future.”

Paychex also published its full-year results on Tuesday that posted a 7% increase in its revenue to £3.18 billion. At £1.19 billion, its operating income also came in 7% higher for fiscal 2020. In terms of annual net income, the American company noted a 6% increase that translated to a slightly lower 5% increase on an adjusted basis. Lastly, Paychex registered £2.39 of adjusted diluted earnings per share in fiscal 2020.

At the time of writing, Paychex is valued at £21.40 billion and has a price to earnings ratio of 24.46.

Invezz uses cookies to provide you with a great user experience. By using Invezz, you accept our privacy policy.