HR software firm Paychex beats Q1 adjusted EPS estimates

Paychex

30/09/2025 13:40

Overview

Paychex fiscal Q1 revenue rises 17% yr/yr, and came in-line with  analyst expectations

Adjusted EPS for fiscal Q1 beats consensus, reflecting successful Paycor integration

Co raises full-year earnings outlook, indicating confidence in continued growth

Outlook

Company anticipates fiscal 2026 adjusted EPS growth of 9% to 11%

Paychex raises full-year earnings outlook

Company's fiscal 2026 guidance excludes acquisition-related costs

Result Drivers

PAYCOR INTEGRATION - Successful integration of Paycor contributed significantly to revenue growth, with Management Solutions revenue increasing by 21%

CLIENT GROWTH - Increase in the number of clients served and higher revenue per client drove revenue growth in Management Solutions

TECHNOLOGY INVESTMENTS - Strategic investments in AI and technology enhanced client experience and operational efficiency, supporting revenue growth

Key Details

Metric
Beat/Miss
Actual
Consensus Estimate
Q1 Revenue
Met
$1.54 bln
$1.54 bln (11 Analysts)
Q1 Adjusted EPS
Beat
$1.22
$1.21 (13 Analysts)
Q1 EPS
$1.06
Q1 Adjusted Net Income
Beat
$440.80 mln
$439 mln (10 Analysts)
Q1 Adjusted Operating Income
Beat
$626.70 mln
$616.10 mln (10 Analysts)
Q1 Adjusted Operating Margin
40.7%


Analyst Coverage

The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 1 "strong buy" or "buy", 13 "hold" and 2 "sell" or "strong sell"

The average consensus recommendation for the employment services peer group is "buy."

Wall Street's median 12-month price target for Paychex Inc is $142.00, about 9.5% above its September 29 closing price of $128.53

The stock recently traded at 23 times the next 12-month earnings vs. a P/E of 30 three months ago

Press Release: ID:nBwVkT0wa

(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)