PAYCHEX INC (PAYX) Fundamental Analysis & Valuation

NASDAQ:PAYX • US7043261079

98.38 USD
+2.59 (+2.7%)
At close: Mar 5, 2026
98.38 USD
0 (0%)
After Hours: 3/5/2026, 8:14:20 PM
Overview Stock Chart Technical Analysis Fundamental Analysis Forecast Earnings Financials Ownership News

This PAYX fundamental analysis includes valuation metrics, fair value assessment, financial health analysis, profitability trends, growth metrics and dividend sustainability analysis.

Fundamental Rating

6

We assign a fundamental rating of 6 out of 10 to PAYX. PAYX was compared to 88 industry peers in the Professional Services industry. While PAYX belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. PAYX has a decent growth rate and is not valued too expensively. Finally PAYX also has an excellent dividend rating.


Dividend Valuation Growth Profitability Health

9

1. PAYX Profitability Analysis

1.1 Basic Checks

  • PAYX had positive earnings in the past year.
  • PAYX had a positive operating cash flow in the past year.
  • Each year in the past 5 years PAYX has been profitable.
  • PAYX had a positive operating cash flow in each of the past 5 years.
PAYX Yearly Net Income VS EBIT VS OCF VS FCFPAYX Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 500M 1B 1.5B 2B

1.2 Ratios

  • The Return On Assets of PAYX (9.66%) is better than 79.55% of its industry peers.
  • PAYX's Return On Equity of 41.13% is amongst the best of the industry. PAYX outperforms 92.05% of its industry peers.
  • The Return On Invested Capital of PAYX (19.25%) is better than 86.36% of its industry peers.
  • PAYX had an Average Return On Invested Capital over the past 3 years of 28.05%. This is significantly above the industry average of 12.74%.
  • The 3 year average ROIC (28.05%) for PAYX is well above the current ROIC(19.25%). The reason for the recent decline needs to be investigated.
Industry RankSector Rank
ROA 9.66%
ROE 41.13%
ROIC 19.25%
ROA(3y)13.68%
ROA(5y)13.48%
ROE(3y)43.07%
ROE(5y)42.31%
ROIC(3y)28.05%
ROIC(5y)28.53%
PAYX Yearly ROA, ROE, ROICPAYX Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 10 20 30 40

1.3 Margins

  • With an excellent Profit Margin value of 26.45%, PAYX belongs to the best of the industry, outperforming 94.32% of the companies in the same industry.
  • PAYX's Profit Margin has improved in the last couple of years.
  • With an excellent Operating Margin value of 39.76%, PAYX belongs to the best of the industry, outperforming 97.73% of the companies in the same industry.
  • PAYX's Operating Margin has improved in the last couple of years.
  • Looking at the Gross Margin, with a value of 91.14%, PAYX belongs to the top of the industry, outperforming 98.86% of the companies in the same industry.
  • In the last couple of years the Gross Margin of PAYX has remained more or less at the same level.
Industry RankSector Rank
OM 39.76%
PM (TTM) 26.45%
GM 91.14%
OM growth 3Y1.57%
OM growth 5Y2.95%
PM growth 3Y-0.51%
PM growth 5Y1.82%
GM growth 3Y-0.99%
GM growth 5Y-0.7%
PAYX Yearly Profit, Operating, Gross MarginsPAYX Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 20 40 60 80

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4

2. PAYX Health Analysis

2.1 Basic Checks

  • With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), PAYX is creating value.
  • PAYX has about the same amout of shares outstanding than it did 1 year ago.
  • Compared to 5 years ago, PAYX has more shares outstanding
  • PAYX has a worse debt/assets ratio than last year.
PAYX Yearly Shares OutstandingPAYX Yearly Shares OutstandingYearly Shares Outstanding 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 100M 200M 300M
PAYX Yearly Total Debt VS Total AssetsPAYX Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 5B 10B 15B

2.2 Solvency

  • PAYX has an Altman-Z score of 2.78. This is not the best score and indicates that PAYX is in the grey zone with still only limited risk for bankruptcy at the moment.
  • With a Altman-Z score value of 2.78, PAYX perfoms like the industry average, outperforming 53.41% of the companies in the same industry.
  • The Debt to FCF ratio of PAYX is 2.53, which is a good value as it means it would take PAYX, 2.53 years of fcf income to pay off all of its debts.
  • PAYX has a better Debt to FCF ratio (2.53) than 68.18% of its industry peers.
  • A Debt/Equity ratio of 1.18 is on the high side and indicates that PAYX has dependencies on debt financing.
  • PAYX has a Debt to Equity ratio of 1.18. This is in the lower half of the industry: PAYX underperforms 73.86% of its industry peers.
Industry RankSector Rank
Debt/Equity 1.18
Debt/FCF 2.53
Altman-Z 2.78
ROIC/WACC2.36
WACC8.14%
PAYX Yearly LT Debt VS Equity VS FCFPAYX Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 1B 2B 3B 4B

2.3 Liquidity

  • PAYX has a Current Ratio of 1.27. This is a normal value and indicates that PAYX is financially healthy and should not expect problems in meeting its short term obligations.
  • PAYX has a worse Current ratio (1.27) than 60.23% of its industry peers.
  • A Quick Ratio of 1.27 indicates that PAYX should not have too much problems paying its short term obligations.
  • With a Quick ratio value of 1.27, PAYX is not doing good in the industry: 60.23% of the companies in the same industry are doing better.
Industry RankSector Rank
Current Ratio 1.27
Quick Ratio 1.27
PAYX Yearly Current Assets VS Current LiabilitesPAYX Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2B 4B 6B 8B

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WACCDebt/EquityHow to determine the health of a companyAltman-Z scoreShow peers with great health

4

3. PAYX Growth Analysis

3.1 Past

  • The Earnings Per Share has been growing slightly by 7.50% over the past year.
  • The Earnings Per Share has been growing by 10.74% on average over the past years. This is quite good.
  • The Revenue has grown by 12.37% in the past year. This is quite good.
  • The Revenue has been growing slightly by 6.64% on average over the past years.
EPS 1Y (TTM)7.5%
EPS 3Y9.82%
EPS 5Y10.74%
EPS Q2Q%10.53%
Revenue 1Y (TTM)12.37%
Revenue growth 3Y6.51%
Revenue growth 5Y6.64%
Sales Q2Q%18.28%

3.2 Future

  • Based on estimates for the next years, PAYX will show a quite strong growth in Earnings Per Share. The EPS will grow by 8.20% on average per year.
  • The Revenue is expected to grow by 7.57% on average over the next years.
EPS Next Y12.44%
EPS Next 2Y10.02%
EPS Next 3Y8.92%
EPS Next 5Y8.2%
Revenue Next Year16.92%
Revenue Next 2Y11.27%
Revenue Next 3Y9.48%
Revenue Next 5Y7.57%

3.3 Evolution

  • The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
  • When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
PAYX Yearly Revenue VS EstimatesPAYX Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2015 2017 2019 2021 2023 2025 2027 2029 2031 2033 2B 4B 6B 8B
PAYX Yearly EPS VS EstimatesPAYX Yearly EPS VS EstimatesYearly EPS VS Estimates 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2 4 6

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5

4. PAYX Valuation Analysis

4.1 Price/Earnings Ratio

  • The Price/Earnings ratio is 19.07, which indicates a rather expensive current valuation of PAYX.
  • 60.23% of the companies in the same industry are more expensive than PAYX, based on the Price/Earnings ratio.
  • When comparing the Price/Earnings ratio of PAYX to the average of the S&P500 Index (26.74), we can say PAYX is valued slightly cheaper.
  • With a Price/Forward Earnings ratio of 16.32, PAYX is valued correctly.
  • Based on the Price/Forward Earnings ratio, PAYX is valued a bit cheaper than 61.36% of the companies in the same industry.
  • Compared to an average S&P500 Price/Forward Earnings ratio of 24.82, PAYX is valued a bit cheaper.
Industry RankSector Rank
PE 19.07
Fwd PE 16.32
PAYX Price Earnings VS Forward Price EarningsPAYX Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

  • PAYX's Enterprise Value to EBITDA ratio is in line with the industry average.
  • 64.77% of the companies in the same industry are more expensive than PAYX, based on the Price/Free Cash Flow ratio.
Industry RankSector Rank
P/FCF 18
EV/EBITDA 13.76
PAYX Per share dataPAYX EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 0 5 -5 10 15

4.3 Compensation for Growth

  • The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
  • The excellent profitability rating of PAYX may justify a higher PE ratio.
PEG (NY)1.53
PEG (5Y)1.77
EPS Next 2Y10.02%
EPS Next 3Y8.92%

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Price/EarningsPrice/FCFFCF per shareEV/EBITDAPEG RATIOShow best valued peers

7

5. PAYX Dividend Analysis

5.1 Amount

  • PAYX has a Yearly Dividend Yield of 4.57%, which is a nice return.
  • PAYX's Dividend Yield is rather good when compared to the industry average which is at 1.64. PAYX pays more dividend than 90.91% of the companies in the same industry.
  • Compared to an average S&P500 Dividend Yield of 1.82, PAYX pays a better dividend.
Industry RankSector Rank
Dividend Yield 4.57%

5.2 History

  • The dividend of PAYX is nicely growing with an annual growth rate of 10.17%!
  • PAYX has been paying a dividend for at least 10 years, so it has a reliable track record.
  • PAYX has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)10.17%
Div Incr Years11
Div Non Decr Years11
PAYX Yearly Dividends per sharePAYX Yearly Dividends per shareYearly Dividends per share 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 1 2 3 4

5.3 Sustainability

  • PAYX pays out 95.21% of its income as dividend. This is not a sustainable payout ratio.
  • The dividend of PAYX is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP95.21%
EPS Next 2Y10.02%
EPS Next 3Y8.92%
PAYX Yearly Income VS Free CF VS DividendPAYX Yearly Income VS Free CF VS DividendYearly Income VS Free CF VS Dividend 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 500M 1B 1.5B
PAYX Dividend Payout.PAYX Dividend Payout, showing the Payout Ratio.PAYX Dividend Payout.PayoutRetained Earnings

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PAYX Fundamentals: All Metrics, Ratios and Statistics

PAYCHEX INC

NASDAQ:PAYX (3/5/2026, 8:14:20 PM)

After market: 98.38 0 (0%)

98.38

+2.59 (+2.7%)

Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryProfessional Services
Earnings (Last)12-19
Earnings (Next)03-24
Inst Owners81.23%
Inst Owner Change4.94%
Ins Owners10.38%
Ins Owner Change-2.84%
Market Cap35.32B
Revenue(TTM)6.03B
Net Income(TTM)1.60B
Analysts53.91
Price Target123.02 (25.05%)
Short Float %6.25%
Short Ratio5.21
Dividend
Industry RankSector Rank
Dividend Yield 4.57%
Yearly Dividend4.02
Dividend Growth(5Y)10.17%
DP95.21%
Div Incr Years11
Div Non Decr Years11
Ex-Date01-28
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.15%
Min EPS beat(2)-0.85%
Max EPS beat(2)0.54%
EPS beat(4)1
Avg EPS beat(4)-0.88%
Min EPS beat(4)-1.94%
Max EPS beat(4)0.54%
EPS beat(8)2
Avg EPS beat(8)-0.69%
EPS beat(12)3
Avg EPS beat(12)-0.63%
EPS beat(16)6
Avg EPS beat(16)0.4%
Revenue beat(2)0
Avg Revenue beat(2)-2.25%
Min Revenue beat(2)-2.65%
Max Revenue beat(2)-1.85%
Revenue beat(4)0
Avg Revenue beat(4)-2.37%
Min Revenue beat(4)-2.65%
Max Revenue beat(4)-1.85%
Revenue beat(8)0
Avg Revenue beat(8)-2.26%
Revenue beat(12)0
Avg Revenue beat(12)-2.09%
Revenue beat(16)2
Avg Revenue beat(16)-1.47%
PT rev (1m)-1.29%
PT rev (3m)-10.63%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0.69%
EPS NY rev (1m)0%
EPS NY rev (3m)0.35%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-1.41%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.42%
Valuation
Industry RankSector Rank
PE 19.07
Fwd PE 16.32
P/S 5.85
P/FCF 18
P/OCF 15.89
P/B 9.1
P/tB N/A
EV/EBITDA 13.76
EPS(TTM)5.16
EY5.24%
EPS(NY)6.03
Fwd EY6.13%
FCF(TTM)5.46
FCFY5.55%
OCF(TTM)6.19
OCFY6.29%
SpS16.81
BVpS10.81
TBVpS-6.85
PEG (NY)1.53
PEG (5Y)1.77
Graham Number35.42
Profitability
Industry RankSector Rank
ROA 9.66%
ROE 41.13%
ROCE 25.31%
ROIC 19.25%
ROICexc 22.93%
ROICexgc 111.92%
OM 39.76%
PM (TTM) 26.45%
GM 91.14%
FCFM 32.51%
ROA(3y)13.68%
ROA(5y)13.48%
ROE(3y)43.07%
ROE(5y)42.31%
ROIC(3y)28.05%
ROIC(5y)28.53%
ROICexc(3y)39.45%
ROICexc(5y)39.54%
ROICexgc(3y)122.07%
ROICexgc(5y)118.33%
ROCE(3y)36.92%
ROCE(5y)37.54%
ROICexgc growth 3Y-2.65%
ROICexgc growth 5Y2.68%
ROICexc growth 3Y-20.58%
ROICexc growth 5Y-8.53%
OM growth 3Y1.57%
OM growth 5Y2.95%
PM growth 3Y-0.51%
PM growth 5Y1.82%
GM growth 3Y-0.99%
GM growth 5Y-0.7%
F-Score5
Asset Turnover0.37
Health
Industry RankSector Rank
Debt/Equity 1.18
Debt/FCF 2.53
Debt/EBITDA 1.66
Cap/Depr 75.29%
Cap/Sales 4.33%
Interest Coverage 250
Cash Conversion 80.95%
Profit Quality 122.94%
Current Ratio 1.27
Quick Ratio 1.27
Altman-Z 2.78
F-Score5
WACC8.14%
ROIC/WACC2.36
Cap/Depr(3y)100.38%
Cap/Depr(5y)88.13%
Cap/Sales(3y)3.56%
Cap/Sales(5y)3.37%
Profit Quality(3y)100.66%
Profit Quality(5y)101.87%
High Growth Momentum
Growth
EPS 1Y (TTM)7.5%
EPS 3Y9.82%
EPS 5Y10.74%
EPS Q2Q%10.53%
EPS Next Y12.44%
EPS Next 2Y10.02%
EPS Next 3Y8.92%
EPS Next 5Y8.2%
Revenue 1Y (TTM)12.37%
Revenue growth 3Y6.51%
Revenue growth 5Y6.64%
Sales Q2Q%18.28%
Revenue Next Year16.92%
Revenue Next 2Y11.27%
Revenue Next 3Y9.48%
Revenue Next 5Y7.57%
EBIT growth 1Y6.35%
EBIT growth 3Y8.18%
EBIT growth 5Y9.79%
EBIT Next Year28.87%
EBIT Next 3Y13.71%
EBIT Next 5Y10.88%
FCF growth 1Y8.26%
FCF growth 3Y5.13%
FCF growth 5Y5.19%
OCF growth 1Y11.67%
OCF growth 3Y6.14%
OCF growth 5Y5.7%

PAYCHEX INC / PAYX FAQ

Can you provide the ChartMill fundamental rating for PAYCHEX INC?

ChartMill assigns a fundamental rating of 6 / 10 to PAYX.


What is the valuation status of PAYCHEX INC (PAYX) stock?

ChartMill assigns a valuation rating of 5 / 10 to PAYCHEX INC (PAYX). This can be considered as Fairly Valued.


What is the profitability of PAYX stock?

PAYCHEX INC (PAYX) has a profitability rating of 9 / 10.


Can you provide the PE and PB ratios for PAYX stock?

The Price/Earnings (PE) ratio for PAYCHEX INC (PAYX) is 19.07 and the Price/Book (PB) ratio is 9.1.


How financially healthy is PAYCHEX INC?

The financial health rating of PAYCHEX INC (PAYX) is 4 / 10.