The upcoming report from Paychex (PAYX) is expected to reveal quarterly earnings of $1.19 per share, indicating an increase of 6.3% compared to the year-ago period. Analysts forecast revenues of $1.39 billion, representing an increase of 7.3% year over year.
The consensus EPS estimate for the quarter has undergone a downward revision of 1.8% in the past 30 days, bringing it to its present level. This represents how the covering analysts, as a whole, have reassessed their initial estimates during this timeframe.
Prior to a company's earnings announcement, it is crucial to consider revisions to earnings estimates. This serves as a significant indicator for predicting potential investor actions regarding the stock. Empirical research has consistently demonstrated a robust correlation between trends in earnings estimate revision and the short-term price performance of a stock.
While investors typically use consensus earnings and revenue estimates as indicators of quarterly business performance, exploring analysts' projections for specific key metrics can offer valuable insights.
Bearing this in mind, let's now explore the average estimates of specific Paychex metrics that are commonly monitored and projected by Wall Street analysts.
The average prediction of analysts places 'Revenue- Management Solutions' at $1.01 billion. The estimate indicates a change of +9% from the prior-year quarter.
Analysts predict that the 'Revenue- Interest on funds held for clients' will reach $40.14 million. The estimate indicates a change of +5.1% from the prior-year quarter.
Based on the collective assessment of analysts, 'Revenue- Total service revenue' should arrive at $1.36 billion. The estimate indicates a change of +7.9% from the prior-year quarter.
The consensus among analysts is that 'Revenue- PEO and Insurance Services' will reach $341.79 million. The estimate suggests a change of +4.7% year over year.
It is projected by analysts that the 'Average investment Balance - Funds held for clients' will reach $4.43 billion. Compared to the current estimate, the company reported $4.68 billion in the same quarter of the previous year.
According to the collective judgment of analysts, 'Average interest rates earned (exclusive of net realized gains) - Funds held for clients' should come in at 3.4%. Compared to the present estimate, the company reported 3.5% in the same quarter last year.
Analysts expect 'Average investment Balance - Corporate cash equivalents and investments' to come in at $1.63 billion. The estimate compares to the year-ago value of $1.65 billion.
Analysts' assessment points toward 'Average interest rates earned (exclusive of net realized gains) - Corporate cash equivalents and investments' reaching 4.3%. The estimate is in contrast to the year-ago figure of 5.3%.
View all Key Company Metrics for Paychex here>>>
Over the past month, Paychex shares have recorded returns of -3.8% versus the Zacks S&P 500 composite's +0.6% change. Based on its Zacks Rank #3 (Hold), PAYX will likely exhibit a performance that aligns with the overall market in the upcoming period. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>
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Paychex, Inc. (PAYX): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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