Paychex, Inc. (PAYX) Stock Analysis — Fair Value, Risk & Moat Rating
NMS · Technology · Software - Application
Is Paychex, Inc. a safe investment right now?
Paychex, Inc.'s Altman Z-Score of 2.74 places it in the gray zone. Our fair value estimate is $86.80 (Fairly Valued). Moat rating: 3.4/5 stars.
Could Paychex, Inc. go bankrupt? Altman Z-Score analysis
Z-Score of 2.74 places the company in the gray zone (1.8-3.0), warranting closer scrutiny.
- Below 1.8 — Distress Zone (high bankruptcy risk)
- 1.8 to 3.0 — Gray Zone (elevated uncertainty)
- Above 3.0 — Safe Zone (financially healthy)
What drives PAYX's Z-Score?
| Component | Formula | Value | Weight | Contribution |
|---|---|---|---|---|
| A · Working Capital / Total Assets | WC / TA | 0.1183 | 1.2 | 0.14 |
| B · Retained Earnings / Total Assets | RE / TA | 0.1375 | 1.4 | 0.19 |
| C · EBIT / Total Assets | EBIT / TA | 0.1377 | 3.3 | 0.45 |
| D · Market Cap / Total Liabilities | MCap / TL | 2.6918 | 0.6 | 1.62 |
| E · Revenue / Total Assets | Rev / TA | 0.3364 | 1.0 | 0.34 |
How has PAYX's financial health changed over time?
| Year | Z-Score | Zone |
|---|---|---|
| 2022 | 4.59 | Safe |
| 2023 | 4.44 | Safe |
| 2024 | 4.8 | Safe |
| 2025 | 2.74 | Gray |
Source: Calculated from PAYX's latest 10-K filing on SEC EDGAR.
What is Paychex, Inc. actually worth?
How we calculated this
| Input | Value | Source |
|---|---|---|
| Predicted EPS (α) | $4.96 | Proprietary blend of reported actuals (3Q actual) + analyst consensus, weighted by α |
| Last Year EPS | $4.58 | Annual report (SEC EDGAR) |
| Analyst Consensus EPS (This Year) | $5.50 | 15 analysts consensus |
| Trailing P/E | 20.6x | Current market pricing |
| Fair P/E (β discount) | 17.5x | Trailing PE adjusted by value discount factor β, hard-capped |
| Earnings Trend (γ) | Growing | Directional signal: predicted vs trailing EPS |
Wall Street Reference: Analyst consensus target price is $100.93 (15 analysts). This is shown for reference only and is not used in our valuation model.
Source: Earnings data from SEC EDGAR filings. Market data via Yahoo Finance.
Does Paychex, Inc. have a durable competitive advantage?
Moat rating: 3.4/5.
What makes up PAYX's moat score?
ROIC Stability
ROIC variability over the past decade. Score: 4/5.
Gross Margin Trend
Gross margin trajectory over the past decade. Score: 3/5.
Switching Costs
Estimated customer lock-in based on margin level. Score: 3/5.
How stable is PAYX's return on invested capital?
| Year | ROIC | Trend |
|---|---|---|
| 2022 | 47.8% | — |
| 2023 | 48.5% | Stable |
| 2024 | 48.8% | Stable |
| 2025 | 25.1% | Declining |
Source: ROIC calculated from SEC EDGAR filings.
Is Paychex, Inc.'s dividend safe?
Can Paychex, Inc. afford its dividend?
Payout ratio is 95.4%. FCF covers the dividend 1.5x. 39 consecutive years of payments.
Paychex, Inc.'s key financial metrics
| Metric | Latest | 1Y Ago | 3Y Ago | Trend |
|---|---|---|---|---|
| Revenue | $5.6B | $5.3B | $4.6B | Rising |
| Net Income | $1.7B | $1.7B | $1.4B | Rising |
| Free Cash Flow | $1.7B | $1.7B | $1.5B | Rising |
| Gross Margin | 72.4% | 72.0% | 70.6% | Stable |
Recent events that affect our PAYX analysis
PAYX earnings report scheduled
Upcoming report. Consensus EPS estimate: $1.30. Revenue estimate: $1.60B. Our current Fair Value: $86.80 — a significant beat or miss could shift this estimate.
PAYX analyst consensus: 5% bullish (1 of 19 analysts)
0 Strong Buy, 1 Buy, 14 Hold, 3 Sell, 1 Strong Sell. Consensus target: $100.93 (8.0% upside). Compare with our independent Fair Value: $86.80.
PAYX filed quarterly report (10-Q)
Quarterly update with interim financials. May signal changes to earnings trajectory and balance sheet health. View on SEC EDGAR →
PAYX beat EPS estimates by 2.3%
Reported EPS: $1.71 vs estimate $1.67. Earnings strength supports our Fair Value of $86.80 (7.1% below current price).
PAYX filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
PAYX paid $1.0800/share dividend
Dividend Safety Grade: B. Payout ratio: 95.4%.
PAYX filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
PAYX filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
PAYX filed quarterly report (10-Q)
Quarterly update with interim financials. May signal changes to earnings trajectory and balance sheet health. View on SEC EDGAR →
PAYX beat EPS estimates by 2.4%
Reported EPS: $1.26 vs estimate $1.23. Earnings strength supports our Fair Value of $86.80 (7.1% below current price).
PAYX filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
PAYX paid $1.0800/share dividend
Dividend Safety Grade: B. Payout ratio: 95.4%.
PAYX filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
PAYX beat EPS estimates by 1.4%
Reported EPS: $1.22 vs estimate $1.20. Earnings strength supports our Fair Value of $86.80 (7.1% below current price).
PAYX filed quarterly report (10-Q)
Quarterly update with interim financials. May signal changes to earnings trajectory and balance sheet health. View on SEC EDGAR →
PAYX filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
PAYX paid $1.0800/share dividend
Dividend Safety Grade: B. Payout ratio: 95.4%.
PAYX filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
PAYX filed annual report (10-K)
Annual filing with full-year financials. Our Altman Z-Score, Moat, and Fair Value models are derived from this data. View on SEC EDGAR →
PAYX missed EPS estimates by 0.7%
Reported EPS: $1.19 vs estimate $1.20. Our Fair Value of $86.80 may face downward pressure if the trend continues.
PAYX filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
PAYX filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
PAYX paid $1.0800/share dividend
Dividend Safety Grade: B. Payout ratio: 95.4%.
PAYX filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
PAYX filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
PAYX filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
PAYX beat EPS estimates by 0.7%
Reported EPS: $1.49 vs estimate $1.48. Earnings strength supports our Fair Value of $86.80 (7.1% below current price).
PAYX filed quarterly report (10-Q)
Quarterly update with interim financials. May signal changes to earnings trajectory and balance sheet health. View on SEC EDGAR →
PAYX filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
PAYX filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
PAYX paid $0.9800/share dividend
Dividend Safety Grade: B. Payout ratio: 95.4%.
PAYX filed 8-K (material event)
8-K filings disclose material events — acquisitions, leadership changes, or guidance revisions that may affect valuation. View on SEC EDGAR →
Common questions about Paychex, Inc.
What is Paychex, Inc. stock price today?
Paychex, Inc. (PAYX) stock price is $93.43 as of the latest market close, traded on the NASDAQ exchange.
What does Paychex, Inc. do?
Paychex, Inc., together with its subsidiaries, provides human capital management solutions (HCM) for payroll, employee benefits, human resources (HR), and insurance services for small to medium-sized businesses in the United States, Europe, and India. It offers payroll processing services; payroll tax administration services; employee payment services; and regulatory compliance services. It provides retirement solutions, such as plan implementation, ongoing compliance with government regulations, employee and employer reporting, participant and employer online access, electronic funds transfer, and other administrative services; HCM solutions from recruiting and hiring to retirement; and talent management and talent acquisition services.
What is Paychex, Inc. market cap?
Paychex, Inc. has a market capitalization of $33.48B, classifying it as a large-cap stock in the Technology sector.
What sector and industry is PAYX in?
Paychex, Inc. operates in the Technology sector, specifically within the Software - Application industry. It trades on the NASDAQ under the ticker symbol PAYX.
Is PAYX stock overvalued or undervalued?
Based on our valuation model, Paychex, Inc. trades 7.6% above our fair value estimate — potentially overvalued.
- FairValueLabs Fair Value: $86.80
- Current Price: $93.43
- Valuation Zone: Fairly Valued
What is PAYX stock forecast and analyst target price?
Based on 15 Wall Street analysts, the consensus price target for Paychex, Inc. is $100.93, implying upside of 8.0% from the current price.
- Analyst High Target: $125.00
- Analyst Low Target: $90.00
Note: Analyst targets are shown for reference and are not used in our valuation model.
Is Paychex, Inc. revenue and earnings growing?
Here are the analyst consensus growth estimates for Paychex, Inc.:
- Revenue growth (current year est.): 16.8%
- EPS growth (current year est.): 10.4%
- Revenue growth (next year est.): 5.5%
- EPS growth (next year est.): 7.4%
What are Paychex, Inc.'s key financial metrics?
| Metric | Latest | Trend |
|---|---|---|
| Revenue | $5.6B | Rising |
| Net Income | $1.7B | Rising |
| Free Cash Flow | $1.7B | Rising |
| Gross Margin | 72.4% | Stable |
What is PAYX's P/E ratio?
The price-to-earnings ratio measures how much investors pay per dollar of earnings:
- Trailing P/E (last 12 months): 20.6x
- Forward P/E (next 12 months est.): 15.8x
- FairValueLabs Fair P/E: 17.5x
How volatile is PAYX stock?
Paychex, Inc. has a beta of 1.00, meaning it is roughly in line with overall market volatility. A beta above 1.0 indicates higher price swings relative to the S&P 500, while below 1.0 suggests more stability.
How much cash and debt does Paychex, Inc. have?
Paychex, Inc.'s balance sheet shows:
- Total Cash: $1.78B
- Total Debt: $5.01B
- Net Cash Position: $-3.23B
A positive net cash position means the company holds more cash than debt, reducing financial risk.
Does Paychex, Inc. pay a dividend, and is it safe?
Yes, Paychex, Inc. pays a regular dividend. Here are the key metrics:
- Dividend Yield: 462.0%
- Payout Ratio: 95.4%
- Consecutive Years Paid: 39
- 5-Year Dividend Growth: -16.1%
- FairValueLabs Safety Grade: B
Is Paychex, Inc. at risk of going bankrupt?
Paychex, Inc.'s Altman Z-Score is 2.74, placing it in the gray zone (1.8–3.0) — some financial uncertainty. The Z-Score uses five balance sheet ratios to predict bankruptcy probability within two years.
Does Paychex, Inc. have a durable competitive advantage?
Paychex, Inc. scores 3.4/5 stars (Narrow moat) in our moat analysis:
- ROIC Stability: 4/5
- Gross Margin Trend: 3/5
- Switching Costs: 3/5
A score above 3.5 suggests meaningful pricing power and a defensible market position.
How do I buy PAYX stock?
PAYX shares can be purchased through any brokerage account that provides access to the NASDAQ. Common steps:
- Open an account with a broker (e.g., Fidelity, Schwab, Interactive Brokers)
- Search for ticker symbol PAYX
- Place a market or limit order for your desired number of shares
This is not investment advice. Always do your own research before buying any stock.
Is PAYX a value stock or speculative?
FairValueLabs classifies Paychex, Inc. as Value Investment. It exhibits consistent profitability, reasonable valuation, and financial stability — characteristics of a traditional value investment.
Who is the CEO of Paychex, Inc.?
The current CEO of Paychex, Inc. is Mr. John B. Gibson Jr..
What is PAYX's earnings per share (EPS)?
Earnings per share measures the company's profit allocated to each outstanding share:
- Trailing EPS (last 12 months): $4.53
- Forward EPS (next 12 months est.): $5.90
- Analyst consensus EPS (this year): $5.50
- Analyst consensus EPS (next year): $5.90
Other Technology companies analyzed by FairValueLabs
FairValueLabs Disclaimer
All valuations, scores, ratings, and classifications on this page are produced by the FairValueLabs internal valuation system. They do not represent actual market value, guaranteed outcomes, or professional investment advice. These are analytical estimates for educational and research purposes only.
This is not financial advice. All data is sourced from SEC EDGAR public filings. Always consult a qualified financial advisor before making investment decisions.
Last updated: Apr 22, 2026. Data sources: SEC EDGAR (financial statements), Yahoo Finance (market data, analyst consensus). Data may not reflect the most recent quarter.
PAYX analysis methodology: How we calculate fair value, Z-Scores, and moat ratings