| Factor | Score | Distribution | Value | Avg | Rank |
|---|---|---|---|---|---|
Valuation | 41 | 23.6x | 17.8x | Around median | |
Growth | 68 | 16.9% | 7.1% | Top tier | |
Quality | 95 | 21.9% | 4.5% | Top tier | |
Safety | 70 | 1.2x | 2.6x | Top tier | |
Capital Return | 72 | 3.83% | 2.12% | Top tier | |
Momentum | 62 | -11.4% | 2.9% | Around median | |
Sentiment | 61 | 12 | 3 | Around median |
Estimates — analyst targets and a simplified DCF, not investment advice.
Ten ratios that matter, each compared against its sector median and average — so you can see whether a number is rich or cheap relative to peers in the same sector.
Paychex provides payroll, human resources, benefits, insurance, and retirement solutions to businesses, combining its technology platforms with human advisory expertise. Revenue is generated primarily from Management Solutions, which includes payroll and human resources services, and from Professional Employer Organization and Insurance Solutions, in addition to interest on funds held for clients. The company is also expanding employee-related revenue streams through the Perks marketplace and, through WISE, is developing standalone solutions that do not require use of the core payroll platform.
In Q4 of fiscal 2026, the earnings call held on June 24, 2026, reported that revenue increased 12% to $1.6 billion; including $1.2 billion from Management Solutions, up 14%, $370 million from Professional Employer Organization and Insurance Solutions, up 9%, and $52 million from interest on client funds, up 15%. Operating income margin reached 37.7% after improving by approximately 750 basis points, and adjusted operating margin reached 42.1% after improving by approximately 170 basis points. Diluted earnings per share increased 43% to $1.17, and adjusted diluted earnings per share increased 11% to $1.32; meanwhile, EDGAR data filed for the same quarter shows revenue of $1.8 billion, gross profit of $1.3 billion, and net income of $420.6 million.
In fiscal 2026, revenue increased 17% to $6.5 billion, and Management Solutions revenue rose 20% to $4.9 billion, compared with 7% growth in Professional Employer Organization and Insurance Solutions revenue to $1.4 billion. Operating income margin reached 38.6%, and adjusted operating margin increased by approximately 70 basis points to 43.2%, while net income according to EDGAR data reached $1.8 billion and earnings per share reached $4.89. Operating cash flow also increased 35% to $2.6 billion and free cash flow increased 36% to $2.3 billion, and the company returned $2.2 billion to shareholders through $1.6 billion in dividends and $600 million in share repurchases.
The average analyst price target is $108.8, within a range of $103 to $115, and the average is approximately 22% below the 52-week range high of $139.53. The Hold consensus reflects a cautious stance despite fiscal 2026 growth and is consistent with revenue growth guidance slowing to 5%–6% and growth depending on pricing and cross-selling. The provided data does not include a usable price-to-earnings ratio, so the stock cannot be evaluated on an earnings-multiple basis using the provided sources.
Figures in the text are as of 2026-08-27; the live price is shown at the top of the page.
Paychex expects total revenue growth of between 5% and 6% in fiscal 2027, with the same range for Management Solutions and growth of between 6% and 7% for PEO and Insurance Solutions. Management said the client base will be nearly stable or may improve slightly within targeted client sizes. Therefore, most growth will come from higher revenue per client, split approximately evenly between pricing and expanding Paychex's wallet share.
Paycor added approximately eight percentage points to Management Solutions revenue growth in Q4 of fiscal 2026. Paychex exceeded its cost-savings target, achieving more than $100 million, while synergies added more than 50 basis points to revenue growth during fiscal 2026. The company is selling ASO, retirement, and PEO solutions to the Paycor base, and the enterprise segment recorded high-single-digit growth across both platforms in Q4 of fiscal 2026.
WISE powers approximately 600 features and agents and is based on more than 26 trillion proprietary data points. In a limited launch within Flex involving approximately 10,000 clients, reporting and timekeeping enhancements reduced errors by approximately 70%. The solutions also allow work schedules to be created within minutes and reduce timecard approval time by more than 50%, while keeping humans in the oversight loop.
Automated analysis for informational purposes only — not investment advice.
During fiscal 2026, Paychex completed an update of the operating layer and separated the tax engine and payment orchestration into more flexible components. This allows a client to retain an insurance or retirement product even if it leaves the human capital management platform, and it also allows compliance tools or benefits to be sold without first winning the payroll contract. Perks provides early evidence of this pathway; more than 400,000 unique employees have purchased from it, and the company is expanding its availability to more than 2.5 million employees on Paycor.
The targeted growth rate for fiscal 2027 declined to 5%–6% after revenue grew 17% in fiscal 2026. Management expects interest on client funds to decline by approximately 4%–5%, while the insurance agency remains a headwind for the PEO and Insurance category. Client count is also nearly stable, making the achievement of guidance more dependent on pricing, cross-selling, and retention than on expansion of the client base.
Operating cash flow reached $2.6 billion in fiscal 2026, an increase of 35%, and free cash flow reached $2.3 billion, up 36%. The company returned $2.2 billion to shareholders, including $1.6 billion in cash dividends and $600 million through share repurchases. In contrast, total borrowings were approximately $4.6 billion, compared with $1.2 billion in cash, restricted cash, and corporate investments.
