Paychex (PAYX - Free Report) closed the most recent trading day at $80.74, moving -1.31% from the previous trading session. This change lagged the S&P 500's 0.03% gain on the day. Elsewhere, the Dow gained 0.28%, while the tech-heavy Nasdaq lost 0.04%.
Heading into today, shares of the payroll processor and human-resources services provider had lost 1.2% over the past month, lagging the Business Services sector's gain of 0.96% and the S&P 500's gain of 2.25% in that time.
PAYX will be looking to display strength as it nears its next earnings release. In that report, analysts expect PAYX to post earnings of $0.69 per share. This would mark year-over-year growth of 2.99%. Our most recent consensus estimate is calling for quarterly revenue of $990.93 million, up 14.85% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $3.09 per share and revenue of $4.16 billion, which would represent changes of +8.8% and +10.31%, respectively, from the prior year.
Investors might also notice recent changes to analyst estimates for PAYX. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. PAYX currently has a Zacks Rank of #3 (Hold).
Valuation is also important, so investors should note that PAYX has a Forward P/E ratio of 26.51 right now. This valuation marks a premium compared to its industry's average Forward P/E of 18.52.
Meanwhile, PAYX's PEG ratio is currently 2.95. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Outsourcing was holding an average PEG ratio of 1.81 at yesterday's closing price.
The Outsourcing industry is part of the Business Services sector. This group has a Zacks Industry Rank of 168, putting it in the bottom 35% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.