Paychex Gears Up to Report Q1 Earnings: What's in the Offing?

Paychex, Inc. PAYX will release first-quarter fiscal 2026 results on Sept. 30, before market open.

PAYX has delivered a decent earnings surprise in the trailing four quarters, with the metricoutpacing the Zacks Consensus Estimate in all quarters, delivering an earnings surprise of 1.3%, on average.

Paychex’s Q1 Expectations

The consensus estimate for Paychex’s first-quarter fiscal 2026 revenues is $1.5 billion, indicating a 16.6% increase from that reported in the same quarter last year. Strong segmental growth is expected to have improved the top line.

Our estimate for revenues from Management Solutions is pegged at $1.1 billion, indicating a 20.2% year-over-year rise. The addition of Paycor and higher revenues per client from price realization and product penetration are likely to have aided this segment’s revenues.

We expect PEO and insurance solution revenues to reach $339 million, indicating a 6.2% increase from the same quarter last year. Robust growth in the number of average PEO worksite employees is anticipated to have driven this segment’s revenues.

Interest on funds held for clients is anticipated to be $41.2 million, implying a 10% rise from the year-ago quarter’s actual. The inclusion of Paycor balance is expected to have fueled this segment.

The Zacks Consensus Estimate for earnings is pegged at $1.21 per share, implying a 4.3% increase from the year-ago quarter’s reported figure. The bottom line is likely to have improved on the back of margin expansion.

What Our Model Says About PAYX

Our proven model does not conclusively predict an earnings beat for Paychex this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that is not the case here. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

PAYX has an Earnings ESP of +0.12% and a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank stocks here.

Earnings Snapshot

FactSet FDS reported mixed results for the fourth quarter of fiscal 2025.

FDS’s earnings per share of $4.05 missed the consensus mark by 2.4% but increased 8.3% from the year-ago quarter. Revenues of $596.9 million beat the Zacks Consensus Estimate by a slight margin and 6.2% from the year-ago quarter.

Accenture plc ACN reported impressive fourth-quarter fiscal 2025 results.

ACN’s earnings were $3.03 per share, beating the Zacks Consensus Estimate by 1.7%. The metric increased 8.6% from the year-ago quarter. Total revenues of $17.6 billion beat the consensus estimate by 1.6% and rose 7.3% on a year-over-year basis.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research