Paychex, Inc. (PAYX) 10-Year Financial Performance & Capital Metrics

PAYX • • Industrial / General

IndustrialsStaffing & HRHuman Capital Management & PEO ServicesComprehensive HCM & PEO Providers

AboutPaychex, Inc. provides integrated human capital management solutions for human resources (HR), payroll, benefits, 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, such as new-hire reporting and garnishment processing. The company also provides HR solutions, including payroll, employer compliance, HR and employee benefits administration, risk management outsourcing, and the on-site availability of a professionally trained HR representative; and retirement services administration, including plan implementation, ongoing compliance with government regulations, employee and employer reporting, participant and employer online access, electronic funds transfer, and other administrative services. In addition, it offers cloud-based HR administration software products for employee benefits management and administration, time and attendance, digital communication solutions, recruiting, and onboarding solutions; plan administration outsourcing and state unemployment insurance services; various business services to small to medium-sized businesses comprising payroll funding and outsourcing services, which include payroll processing, invoicing, and tax preparation; and payment processing services, financial fitness programs, and a small-business loan resource center. Further, the company provides insurance services for property and casualty coverage, such as workers' compensation, business-owner policies, cyber security protection, and commercial auto, as well as health and benefits coverage, including health, dental, vision, and life. It markets and sells its services primarily through its direct sales force. The company was founded in 1971 and is headquartered in Rochester, New York.Show more

Revenue $5.57B +5.6%
EBITDA $2.42B +2.8%
Net Income $1.66B -2.0%
EPS (Diluted) 4.58 -1.9%
Gross Margin 72.35% +0.5%
EBITDA Margin 43.38% -2.6%
Operating Margin 39.62% -3.8%
Net Margin 29.74% -7.1%
ROE 41.8% -9.8%
ROIC 30.89% -40.0%
Debt/Equity 1.22 +433.8%
Interest Coverage 20.95 -64.1%

Technical Analysis

Key Insights

Based on financial data analysis

✓Strengths

✓Excellent 3Y average ROE of 45.2%
✓FCF machine: 31.6% free cash flow margin
✓14 consecutive years of dividend growth
✓Healthy dividend yield of 3.6%
✓Healthy 5Y average net margin of 30.0%

✗Weaknesses

✗Trading more than 30% below 52-week high

Price & Volume

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Growth Metrics

Revenue CAGR

10Y7.36%

5Y6.64%

3Y6.51%

TTM12.37%

Profit (Net Income) CAGR

10Y9.4%

5Y8.58%

3Y5.97%

TTM-7.19%

EPS CAGR

10Y9.49%

5Y8.54%

3Y6.05%

TTM-7.16%

ROCE

10Y Avg45.57%

5Y Avg39.25%

3Y Avg39.67%

Latest30.07%

Peer Comparison

Comprehensive HCM & PEO Providers

Name	Market Cap	Current Price	P/E Ratio	Revenue Growth 1Y	Net Margin	ROE	FCF Yield	Debt/Equity
ADPAutomatic Data Processing, Inc.	105.24B	260.20	26.07	7.07%	19.79%	64.9%	4.53%	1.46
PAYXPaychex, Inc.	39.67B	110.51	24.13	5.56%	26.45%	41.13%	4.43%	1.22
BBSIBarrett Business Services, Inc.	1.01B	39.42	19.91	7.03%	4.48%	22.84%		0.10
NSPInsperity, Inc.	1.75B	46.32	19.38	1.46%	0.25%	19.54%	27.6%	4.48
TNETTriNet Group, Inc.	3.04B	63.21	18.43	2.66%	2.61%	120.91%	6.62%	14.81
GLXGGalaxy Payroll Group Limited	3.28M	1.82	0.55	-4.26%	9.7%	3.66%	100%	0.36

Profit & Loss

	May 2016	May 2017	May 2018	May 2019	May 2020	May 2021	May 2022	May 2023	May 2024	May 2025
Sales/Revenue+	2.95B	3.15B	3.38B	3.77B	4.04B	4.06B	4.61B	5.01B	5.28B	5.57B
Revenue Growth %	0.08%	0.07%	0.07%	0.12%	0.07%	0%	0.14%	0.09%	0.05%	0.06%
Cost of Goods Sold+	857.1M	919.6M	1.02B	1.18B	1.28B	1.27B	1.36B	1.45B	1.48B	1.54B
COGS % of Revenue	0.29%	0.29%	0.3%	0.31%	0.32%	0.31%	0.29%	0.29%	0.28%	0.28%
Gross Profit+	2.09B	2.23B	2.36B	2.59B	2.76B	2.79B	3.26B	3.55B	3.8B	4.03B
Gross Margin %	0.71%	0.71%	0.7%	0.69%	0.68%	0.69%	0.71%	0.71%	0.72%	0.72%
Gross Profit Growth %	0.08%	0.07%	0.06%	0.1%	0.06%	0.01%	0.17%	0.09%	0.07%	0.06%
Operating Expenses+	948.2M	992.1M	1.08B	1.22B	1.3B	1.32B	1.42B	1.52B	1.62B	1.82B
OpEx % of Revenue	0.32%	0.31%	0.32%	0.32%	0.32%	0.33%	0.31%	0.3%	0.31%	0.33%
Selling, General & Admin	948.2M	992.1M	1.08B	1.22B	1.3B	1.32B	1.42B	1.52B	1.62B	1.82B
SG&A % of Revenue	0.32%	0.31%	0.32%	0.32%	0.32%	0.33%	0.31%	0.3%	0.31%	0.33%
Research & Development	0	0	0	0	0	0	0	0	0	0
R&D % of Revenue	-	-	-	-	-	-	-	-	-	-
Other Operating Expenses	0	0	0	0	0	0	0	0	0	0
Operating Income+	1.15B	1.24B	1.29B	1.37B	1.46B	1.46B	1.84B	2.03B	2.17B	2.21B
Operating Margin %	0.39%	0.39%	0.38%	0.36%	0.36%	0.36%	0.4%	0.41%	0.41%	0.4%
Operating Income Growth %	0.09%	0.08%	0.04%	0.07%	0.07%	0%	0.26%	0.1%	0.07%	0.02%
EBITDA+	1.26B	1.37B	1.43B	1.55B	1.67B	1.65B	2.03B	2.21B	2.35B	2.42B
EBITDA Margin %	0.43%	0.43%	0.42%	0.41%	0.41%	0.41%	0.44%	0.44%	0.45%	0.43%
EBITDA Growth %	0.09%	0.08%	0.04%	0.09%	0.08%	-0.01%	0.23%	0.09%	0.06%	0.03%
D&A (Non-Cash Add-back)	115.1M	126.9M	138M	181.5M	209.7M	192M	191.8M	176.6M	176.5M	209.5M
EBIT	1.15B	1.26B	1.29B	1.38B	1.46B	1.46B	1.84B	2.03B	2.26B	2.28B
Net Interest Income+	7.3M	7.4M	8M	-4.3M	-26.5M	-33.5M	-33.7M	12.4M	45.4M	-32.6M
Interest Income	8.4M	9.9M	11.9M	13.3M	12.3M	2.3M	2.9M	49.1M	82.7M	72.8M
Interest Expense	1.1M	2.5M	3.9M	17.6M	38.8M	35.8M	36.6M	36.7M	37.3M	105.4M
Other Income/Expense	4.5M	-9.1M	8.6M	-3.3M	-23.4M	-26.5M	-15.4M	15.1M	43.9M	-31.8M
Pretax Income+	1.15B	1.24B	1.3B	1.37B	1.44B	1.43B	1.82B	2.05B	2.22B	2.18B
Pretax Margin %	0.39%	0.4%	0.38%	0.36%	0.36%	0.35%	0.4%	0.41%	0.42%	0.39%
Income Tax+	394.3M	427.5M	362.4M	333.6M	339M	336.7M	431.8M	490.9M	527.6M	518.6M
Effective Tax Rate %	0.66%	0.66%	0.72%	0.76%	0.76%	0.77%	0.76%	0.76%	0.76%	0.76%
Net Income+	756.8M	817.3M	933.7M	1.03B	1.1B	1.1B	1.39B	1.56B	1.69B	1.66B
Net Margin %	0.26%	0.26%	0.28%	0.27%	0.27%	0.27%	0.3%	0.31%	0.32%	0.3%
Net Income Growth %	0.12%	0.08%	0.14%	0.11%	0.06%	-0%	0.27%	0.12%	0.09%	-0.02%
Net Income (Continuing)	756.8M	817.3M	994.1M	1.03B	1.1B	1.1B	1.39B	1.56B	1.69B	1.66B
Discontinued Operations	0	0	0	0	0	0	0	0	0	0
Minority Interest	0	0	0	0	0	0	0	0	0	0
EPS (Diluted)+	2.09	2.25	2.58	2.86	3.04	3.03	3.84	4.30	4.67	4.58
EPS Growth %	0.13%	0.08%	0.15%	0.11%	0.06%	-0%	0.27%	0.12%	0.09%	-0.02%
EPS (Basic)	2.10	2.27	2.60	2.88	3.06	3.05	3.86	4.32	4.69	4.60
Diluted Shares Outstanding	362.5M	362.6M	361.5M	361.8M	361M	362.1M	363.1M	362.3M	362.1M	362M
Basic Shares Outstanding	360.7M	359.8M	359M	359.2M	358.5M	359.9M	360.6M	360.4M	360.3M	360.2M
Dividend Payout Ratio	0.8%	0.81%	0.79%	0.8%	0.81%	0.83%	0.72%	0.75%	0.78%	0.87%

Balance Sheet

	May 2016	May 2017	May 2018	May 2019	May 2020	May 2021	May 2022	May 2023	May 2024	May 2025
Total Current Assets+	4.86B	5.27B	5.78B	5.68B	5.46B	6.17B	6.58B	7.53B	7.25B	8.92B
Cash & Short-Term Investments	352.1M	323.4M	424.2M	712.6M	932.4M	1.03B	1.22B	1.6B	1.5B	1.66B
Cash Only	131.5M	184.6M	358.2M	673.6M	905.2M	995.2M	370M	1.22B	1.47B	1.63B
Short-Term Investments	220.6M	138.8M	66M	39M	27.2M	36.7M	853.9M	373.4M	33.9M	34.5M
Accounts Receivable	444.7M	543.4M	524.6M	854.2M	790.3M	1.05B	1.32B	1.43B	1.63B	1.98B
Days Sales Outstanding	54.99	62.94	56.64	82.65	71.39	94.79	104.33	103.97	112.39	129.38
Inventory	0	0	0	0	0	0	0	0	0	0
Days Inventory Outstanding	-	-	-	-	-	-	-	-	-	-
Other Current Assets	4.06B	4.36B	4.75B	4.09B	3.73B	4.05B	4.01B	4.46B	4.08B	5.24B
Total Non-Current Assets+	1.58B	1.56B	1.68B	3.01B	3.09B	3.06B	3.05B	3.02B	3.13B	7.65B
Property, Plant & Equipment	353M	337.2M	393.5M	408.7M	522.2M	498.8M	480M	457.8M	458.6M	575.3M
Fixed Asset Turnover	8.36x	9.35x	8.59x	9.23x	7.74x	8.13x	9.61x	10.94x	11.51x	9.68x
Goodwill	657.1M	657.1M	814M	1.78B	1.79B	1.82B	1.83B	1.83B	1.88B	4.51B
Intangible Assets	69.5M	57.6M	141.4M	399.1M	330.6M	275.8M	224.6M	187.4M	194.5M	1.95B
Long-Term Investments	441.1M	454M	295.5M	18.3M	10.2M	7.1M	5M	3.8M	3.7M	0
Other Non-Current Assets	56.5M	55.8M	34.9M	397.6M	432M	455.3M	512.5M	535.3M	592.1M	610.9M
Total Assets+	6.44B	6.83B	7.46B	8.68B	8.55B	9.23B	9.64B	10.55B	10.38B	16.56B
Asset Turnover	0.46x	0.46x	0.45x	0.43x	0.47x	0.44x	0.48x	0.47x	0.51x	0.34x
Asset Growth %	-0.01%	0.06%	0.09%	0.16%	-0.02%	0.08%	0.04%	0.09%	-0.02%	0.6%
Total Current Liabilities+	4.37B	4.73B	5.3B	4.84B	4.43B	4.94B	5.27B	5.81B	5.31B	6.96B
Accounts Payable	56.7M	57.2M	73.7M	75.9M	79.4M	89M	105.7M	84.7M	104.3M	129.8M
Days Payables Outstanding	24.15	22.7	26.43	23.52	22.63	25.55	28.45	21.28	25.73	30.76
Short-Term Debt	0	0	0	0	5.1M	7.4M	8.7M	10.2M	18.7M	418.4M
Deferred Revenue (Current)	1000K	1000K	1000K	1000K	1000K	1000K	1000K	1000K	1000K	1000K
Other Current Liabilities	4.04B	4.36B	4.93B	4B	4.25B	4.8B	4.21B	4.69B	4.34B	5.42B
Current Ratio	1.11x	1.12x	1.09x	1.17x	1.23x	1.25x	1.25x	1.30x	1.37x	1.28x
Quick Ratio	1.11x	1.12x	1.09x	1.17x	1.23x	1.25x	1.25x	1.30x	1.37x	1.28x
Cash Conversion Cycle	-	-	-	-	-	-	-	-	-	-
Total Non-Current Liabilities+	163.2M	153.3M	261.9M	1.21B	1.34B	1.34B	1.28B	1.25B	1.27B	5.48B
Long-Term Debt	0	0	0	796.4M	796.8M	797.3M	797.7M	798.2M	798.6M	4.55B
Capital Lease Obligations	0	0	0	13M	96.9M	92.4M	74.8M	57.3M	49M	55.5M
Deferred Tax Liabilities	22.1M	33.9M	154.4M	223.1M	240.8M	218M	165.5M	112.1M	86M	444.7M
Other Non-Current Liabilities	141.1M	119.4M	107.5M	179M	207.9M	233.3M	242.8M	280.2M	339.4M	431.2M
Total Liabilities	4.53B	4.88B	5.56B	6.06B	5.77B	6.28B	6.55B	7.05B	6.58B	12.44B
Total Debt+	0	0	0	809.4M	898.8M	897.1M	881.2M	865.7M	866.3M	5.02B
Net Debt	-131.5M	-184.6M	-358.2M	135.8M	-6.4M	-98.1M	511.2M	-356.3M	-602.6M	3.39B
Debt / Equity	-	-	-	0.31x	0.32x	0.30x	0.29x	0.25x	0.23x	1.22x
Debt / EBITDA	-	-	-	0.52x	0.54x	0.54x	0.43x	0.39x	0.37x	2.08x
Net Debt / EBITDA	-0.10x	-0.14x	-0.25x	0.09x	-0.00x	-0.06x	0.25x	-0.16x	-0.26x	1.40x
Interest Coverage	1042.36x	495.84x	330.13x	77.91x	37.64x	40.80x	50.27x	55.40x	58.29x	20.95x
Total Equity+	1.91B	1.96B	2.02B	2.62B	2.78B	2.95B	3.09B	3.49B	3.8B	4.13B
Equity Growth %	0.07%	0.02%	0.04%	0.29%	0.06%	0.06%	0.05%	0.13%	0.09%	0.09%
Book Value per Share	5.27	5.39	5.60	7.24	7.70	8.14	8.50	9.64	10.50	11.40
Total Shareholders' Equity	1.91B	1.96B	2.02B	2.62B	2.78B	2.95B	3.09B	3.49B	3.8B	4.13B
Common Stock	3.6M	3.6M	3.6M	3.6M	3.6M	3.6M	3.6M	3.6M	3.6M	3.6M
Retained Earnings	926.2M	901.7M	930.3M	1.41B	1.43B	1.45B	1.67B	2.02B	2.21B	2.28B
Treasury Stock	0	0	0	0	0	0	0	0	0	0
Accumulated OCI	29.2M	20M	-36.2M	100K	56.5M	51.8M	-133.9M	-159.9M	-145.1M	-53.7M
Minority Interest	0	0	0	0	0	0	0	0	0	0

Cash Flow

	May 2016	May 2017	May 2018	May 2019	May 2020	May 2021	May 2022	May 2023	May 2024	May 2025
Cash from Operations+	1.02B	960.4M	1.28B	1.27B	1.44B	1.26B	1.51B	1.7B	1.9B	1.95B
Operating CF Margin %	0.34%	0.3%	0.38%	0.34%	0.36%	0.31%	0.33%	0.34%	0.36%	0.35%
Operating CF Growth %	0.14%	-0.06%	0.33%	-0%	0.13%	-0.13%	0.19%	0.13%	0.12%	0.03%
Net Income	756.8M	817.3M	933.7M	1.03B	1.1B	1.1B	1.39B	1.56B	1.69B	1.66B
Depreciation & Amortization	115.1M	126.9M	138M	181.5M	209.7M	192M	191.8M	176.6M	176.5M	209.5M
Stock-Based Compensation	34.6M	35.4M	44.6M	46.2M	47.4M	52.5M	52.8M	62.6M	61.1M	111.8M
Deferred Taxes	7.1M	7.6M	19.2M	4.7M	-4M	-21M	2.3M	-44M	-29.8M	-15.8M
Other Non-Cash Items	78.1M	77.3M	68.9M	232.5M	223.4M	234M	234.2M	264.8M	279.9M	269M
Working Capital Changes	26.5M	-104.1M	72M	-227.8M	-133.7M	-294.7M	-368.4M	-317.9M	-280.4M	-280.7M
Change in Receivables	-37.5M	-103.7M	13.6M	-112.4M	55.1M	-272.9M	-269.9M	-123.6M	114.1M	-109.9M
Change in Inventory	-3.2M	-33.9M	21.4M	0	-400K	-14M	0	-19.9M	0	0
Change in Payables	63.3M	48.9M	47.2M	77.5M	-4.9M	169M	151.8M	67.4M	-127M	67.9M
Cash from Investing+	-63.1M	-424.6M	-679M	-1.63B	771.9M	-460.6M	-1.42B	218.5M	-260.9M	-3.68B
Capital Expenditures	-97.7M	-94.3M	-154M	-123.8M	-127M	-114.6M	-132.6M	-143M	-191.5M	-191.8M
CapEx % of Revenue	0.03%	0.03%	0.05%	0.03%	0.03%	0.03%	0.03%	0.03%	0.04%	0.03%
Acquisitions	-	-	-	-	-	-	-	-	-	-
Investments	-	-	-	-	-	-	-	-	-	-
Other Investing	918.6M	229M	-1.72B	-5.4M	-9.8M	-8.7M	-10.6M	6.3M	-153.8M	-187.1M
Cash from Financing+	-993.6M	-482.7M	-423.8M	-1.01B	-1.49B	-636.4M	-979.3M	-711.4M	-1.87B	2.56B
Debt Issued (Net)	-	-	-	-	-	-	-	-	-	-
Equity Issued (Net)	-	-	-	-	-	-	-	-	-	-
Dividends Paid	-606.5M	-662.3M	-739.7M	-826.8M	-889.4M	-908.7M	-999.6M	-1.18B	-1.32B	-1.45B
Share Repurchases	-	-	-	-	-	-	-	-	-	-
Other Financing	-279.2M	345.8M	459M	-921.1M	-432M	425.7M	164.2M	472M	-399.2M	-21M
Net Change in Cash	-	-	-	-	-	-	-	-	-	-
Free Cash Flow+	920.5M	866.1M	1.12B	1.17B	1.31B	1.15B	1.37B	1.56B	1.74B	1.76B
FCF Margin %	0.31%	0.27%	0.33%	0.31%	0.33%	0.28%	0.3%	0.31%	0.33%	0.32%
FCF Growth %	0.16%	-0.06%	0.3%	0.04%	0.13%	-0.13%	0.2%	0.13%	0.12%	0.01%
FCF per Share	2.54	2.39	3.10	3.22	3.64	3.16	3.78	4.30	4.80	4.86
FCF Conversion (FCF/Net Income)	1.35x	1.18x	1.37x	1.23x	1.31x	1.15x	1.08x	1.09x	1.12x	1.18x
Interest Paid	0	0	0	0	0	0	35.5M	35.7M	36.2M	37.5M
Taxes Paid	0	0	0	0	0	0	397.7M	525.8M	539.5M	512.4M

Key Ratios

Metric	2016	2017	2018	2019	2020	2021	2022	2023	2024	2025
Return on Equity (ROE)	40.94%	42.27%	46.92%	44.55%	40.66%	38.31%	46.17%	47.35%	46.35%	41.8%
Return on Invested Capital (ROIC)	50.65%	52.36%	56.19%	46.52%	39.61%	38.95%	42.82%	45.29%	51.48%	30.89%
Gross Margin	70.96%	70.82%	69.9%	68.78%	68.3%	68.66%	70.59%	70.98%	71.97%	72.35%
Net Margin	25.64%	25.94%	27.62%	27.42%	27.18%	27.05%	30.2%	31.1%	32.03%	29.74%
Debt / Equity	-	-	-	0.31x	0.32x	0.30x	0.29x	0.25x	0.23x	1.22x
Interest Coverage	1042.36x	495.84x	330.13x	77.91x	37.64x	40.80x	50.27x	55.40x	58.29x	20.95x
FCF Conversion	1.35x	1.18x	1.37x	1.23x	1.31x	1.15x	1.08x	1.09x	1.12x	1.18x
Revenue Growth	7.75%	6.75%	7.29%	11.58%	7.1%	0.4%	13.68%	8.57%	5.42%	5.56%

Revenue by Segment

	2019	2020	2021	2022	2023	2024	2025
Management Solutions	2.88B	2.96B	3.02B	3.44B	3.73B	3.87B	4.07B
Management Solutions Growth	-	2.96%	2.04%	13.87%	8.36%	3.64%	5.19%
Peo And Insurance Solutions	814.2M	990.6M	974.1M	1.11B	1.18B	1.27B	1.34B
Peo And Insurance Solutions Growth	-	21.67%	-1.67%	14.08%	5.89%	7.55%	6.11%

Frequently Asked Questions

Valuation & Price

Paychex, Inc. (PAYX) has a price-to-earnings (P/E) ratio of 24.1x. This is roughly in line with market averages.

Growth & Financials

Paychex, Inc. (PAYX) reported $6.03B in revenue for fiscal year 2025. This represents a 171% increase from $2.23B in 2012.

Paychex, Inc. (PAYX) grew revenue by 5.6% over the past year. This is steady growth.

Yes, Paychex, Inc. (PAYX) is profitable, generating $1.60B in net income for fiscal year 2025 (29.7% net margin).

Dividend & Returns

Yes, Paychex, Inc. (PAYX) pays a dividend with a yield of 3.62%. This makes it attractive for income-focused investors.

Paychex, Inc. (PAYX) has a return on equity (ROE) of 41.8%. This is excellent, indicating efficient use of shareholder capital.

Paychex, Inc. (PAYX) generated $2.06B in free cash flow for fiscal year 2025. Positive FCF indicates the company can fund dividends, buybacks, or reinvestment.

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