US professional services company, Paychex Inc. (NASDAQ: PAYX), released financial results for second quarter of fiscal 2024 before the market open on Thursday.

Revenue reached $1.258 billion (up by 6% year-over-year), which fell short of $1.268 billion expected.

Earnings per share was reported at $1.08 per share (up by 9% year-over-year), slightly above estimate of $1.074 per share.

Company overview

• Founded: 1971
• Headquarters: Rochester, New York, United States
• Number of employees: 16,000 (2022)
• Industry: Business Process Outsourcing, human Capital Management
• Key people: B. Thomas Golisano (chairman), John Gibson (president & CEO), Efrain Rivera (senior VP & CFO)

CEO commentary

”We are pleased with our results for the second quarter and the first half of fiscal 2024, with total revenue growth of 6% and diluted earnings per share and adjusted diluted earnings per share growth through the first half of the fiscal year of 10%. The macro-economic environment remains stable for small and mid-sized businesses, who continue to face challenges in both the cost of and access to growth capital; and finding quality talent in the current labor market. Our Small Business Employment Watch continues to show moderation in both job growth and wage inflation,” John Gibson, CEO of the American company commented on the latest results.

”We continue to see demand for our HCM technology, HR and insurance solutions, as businesses struggle to comply with increasing regulations and a challenging HR landscape and labor market,” Gibson concluded.

Stock reaction

The stock fell by around 6% on Thursday, trading at $119.72 a share – the lowest level since 28/11/23.

Stock performance

• 1 month: +0.28%
• 3 months: +5.27%
• Year-to-date: +3.22%
• 1 year: +6.33%

Paychex stock price targets

• Barclays: $126
• UBS Group: $120
• Argus: $130
• Bank of America: $106
• Morgan Stanley: $127
• Royal Bank of Canada: $130
• TD Cowen: $131
• Wedbush: $115
• JP Morgan: $134
• Robert W. Baird: $126
• Deutsche Bank: $116
• Citigroup: $119
• Jefferies Financial: $120

Paychex Inc. is the 419th largest company in the world with a market cap of $43.07 billion.

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Sources: Paychex Inc., TradingView, MarketWatch, Benzinga, CompaniesMarketCap