Paychex (PAYX) up 4% on fiscal Q2 client base growth
14:49, 22 December 2021
Paychex (PAYX) stock rose on Wednesday as the payroll processor and human resources provider reported earnings that beat estimates.
For the fiscal second-quarter ended 30 November, net income rose 22% to $332.1m (£249.2m) from the $272.4m reported in last year's second quarter. Revenue rose 13% to $1.11bn from $983.7m a year earlier.
Diluted earnings per share (EPS) for the second quarter was 91 cents, beating analyst estimates for earnings of 80 cents on revenue of $1.06bn, according to figures widely available on financial news sites.
Stock up 4%
As of 09:45 am EDT (UTC-5), the stock was up 4% at $130.81.
“We posted strong financial results for the second quarter of fiscal 2022, with growth of 13% in total revenue and 21% in diluted earnings per share. Results were driven by growth in employees within our client base and continued strong sales growth and client retention,” Paychex chair and CEO Martin Mucci said in a press release.
Revenue at the company’s management solutions business rose 14%, while professional employer organisation and insurance solutions revenue was up 11%.
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Pandemic trends continued
Paychex said trends that emerged during the pandemic have continued unabated, particularly the demand for human resource advice and the need for benefits packages that address talent needs.
The company said it assisted businesses in securing $6bn in employee retention and paid leave tax credits to date. It also recently introduced an automated tool that businesses can leverage to capture and store employee vaccination status.
Paychex is a provider of integrated human capital management services for human resources, payroll, benefits and insurance needs.
It serves more than 710,000 payroll clients as of 31 May 2021 across more than 100 locations in the US and Europe.