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What Analyst Projections for Key Metrics Reveal About Paychex (PAYX) Q2 Earnings

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Wall Street analysts expect Paychex (PAYX - Free Report) to post quarterly earnings of $1.12 per share in its upcoming report, which indicates a year-over-year increase of 3.7%. Revenues are expected to be $1.31 billion, up 4.4% from the year-ago quarter.

The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. This reflects how the analysts covering the stock have collectively reevaluated their initial estimates during this timeframe.

Ahead of a company's earnings disclosure, it is crucial to give due consideration to changes in earnings estimates. These revisions serve as a noteworthy factor in predicting potential investor reactions to the stock. Numerous empirical studies consistently demonstrate a strong relationship between trends in earnings estimate revision and the short-term price performance of a stock.

While investors typically rely on consensus earnings and revenue estimates to gauge how the business may have fared during the quarter, examining analysts' projections for some of the company's key metrics often helps gain a deeper insight.

That said, let's delve into the average estimates of some Paychex metrics that Wall Street analysts commonly model and monitor.

The consensus estimate for 'Revenue- Management Solutions' stands at $959.27 million. The estimate points to a change of +3.1% from the year-ago quarter.

The combined assessment of analysts suggests that 'Revenue- Interest on funds held for clients' will likely reach $34.81 million. The estimate indicates a year-over-year change of +10.5%.

The consensus among analysts is that 'Revenue- Total service revenue' will reach $1.28 billion. The estimate points to a change of +4.3% from the year-ago quarter.

Analysts expect 'Revenue- PEO and Insurance Services' to come in at $319.37 million. The estimate suggests a change of +8% year over year.

According to the collective judgment of analysts, 'Average investment Balance - Funds held for clients' should come in at $4.13 billion. The estimate compares to the year-ago value of $4.04 billion.

The collective assessment of analysts points to an estimated 'Average interest rates earned (exclusive of net realized gains) - Funds held for clients' of 3.4%. Compared to the present estimate, the company reported 3.1% in the same quarter last year.

Analysts forecast 'Average investment Balance - Corporate cash equivalents and investments' to reach $1.52 billion. Compared to the current estimate, the company reported $1.54 billion in the same quarter of the previous year.

Analysts' assessment points toward 'Average interest rates earned (exclusive of net realized gains) - Corporate cash equivalents and investments' reaching 4.8%. Compared to the present estimate, the company reported 5.3% in the same quarter last year.

View all Key Company Metrics for Paychex here>>>

Over the past month, Paychex shares have recorded returns of -1.4% versus the Zacks S&P 500 composite's +1.2% change. Based on its Zacks Rank #3 (Hold), PAYX will likely exhibit a performance that aligns with the overall market in the upcoming period. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>


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