Paychex Inc - PAYX STOCK NEWS

Paychex, Inc. (PAYX) has launched Paychex Flex® Engage, a comprehensive employee engagement solution designed to help businesses digitally manage their workforce, drive collaboration, and enhance the employee experience. This new offering combines employee engagement, performance reviews, rewards, and compensation management features into one platform, fostering virtual collaboration and transparency between managers and employees.

Key features of Paychex Flex Engage include:

• Employee Engagement: Social dashboard for company events and surveys
• Rewards & Recognition: Peer-to-peer recognition tools and virtual badges
• Performance & Goal Management: Automated review processes and goal-setting
• Compensation Management: Real-time budget tracking and automated pay adjustments

The solution aims to address the needs of today's complex workforce, which includes multi-generations and various work arrangements (on-site, remote, and hybrid).

The Paychex Small Business Employment Watch reports that hourly earnings growth for U.S. workers in businesses with fewer than 50 employees remained steady at 3.16% in July 2024. Weekly earnings growth has been below 3% for six consecutive months. The Small Business Jobs Index shows moderate gains in the first seven months of 2024, with a July reading of 99.87.

Key highlights include:

• Midwest region leads in small business employment growth
• Construction sector leads in earnings growth but shows a decline in job growth
• Weekly hours worked growth remains negative for the 16th consecutive month
• Education and Health Services tops industry employment growth but has the weakest hourly earnings growth

Small businesses continue to face challenges in hiring due to a tight labor market, inflationary pressures, and evolving regulations.

Paychex has been recognized on TIME's inaugural list of America's Best Midsize Companies, ranking 29th out of 500 top-performing U.S.-based organizations. The company was evaluated based on its culture, business results, and corporate responsibility efforts. Paychex president and CEO, John Gibson, expressed honor at the recognition, emphasizing the company's focus on helping businesses succeed and delivering value to customers, investors, and communities.

The list, presented by TIME and Statista, Inc., considered U.S.-based companies with revenue between $100 million and $10 billion in 2022 or 2023. Evaluation criteria included employee satisfaction, positive revenue growth, and sustainability transparency. In 2024, Paychex was also named one of the World's Most Ethical Companies for the 16th time and inducted into the Training Hall of Fame for its commitment to employee development.

Paychex, Inc. has reached a significant milestone in its 401(k) business, now administering plans for over 120,000 employers as of May 31, 2024. The company has surpassed $51 billion in assets under administration. Notably, the Paychex Pooled Employer Plan (PEP), launched in 2021, has been adopted by 34,000 employers with more than $1 billion in plan assets.

Paychex offers integrated 401(k) solutions with its Paychex Flex® HR suite, providing cost-effective retirement benefits to small and mid-sized businesses. The company's offerings include accessible investment management tools, fee transparency, and investment flexibility. Paychex aims to address the retirement savings crisis in America by providing affordable solutions to companies, enabling 1.5 million Americans to save for their future.

Paychex has been named to Selling Power's 2024 '60 Best Companies to Sell For' list for the 11th time. This recognition highlights Paychex's commitment to fostering a top-tier sales organization and delivering exceptional value to customers and employees. The company's sales team leverages advanced technologies and strong cross-departmental partnerships to optimize efficiency and respond to market shifts.

The ranking methodology evaluates companies based on factors including company overview, compensation and benefits, hiring and training practices, diversity and inclusion efforts, and AI incorporation in sales processes. Mark Bottini, Senior VP of Sales at Paychex, emphasized the company's focus on equipping sales professionals with unmatched tools, development opportunities, and solutions to help them reach their full potential.

Today, the Board of Directors of Paychex declared a regular quarterly cash dividend of $0.98 per share. The dividend will be payable on August 29, 2024, to shareholders of record as of August 8, 2024.

The latest Paychex Small Business Employment Watch reveals that U.S. small businesses continued adding jobs in June, albeit slower than in May. Small business hourly earnings growth remained steady at 3.16% for the month.

The national jobs index for June was 100.29, indicating employment gains but at a slower rate compared to May's 100.58 and June 2023's 101.37. The state of California has seen a three-month consecutive decline below 100, indicating job losses, with the Leisure and Hospitality sector particularly affected. Conversely, Education and Health Services, along with Professional and Business Services, saw an uptick in small business employment growth.

Weekly earnings growth improved for the third straight month, albeit marginally, at 2.96%. However, challenges such as complex regulations, a tight labor market, and inflationary pressures continue to impact certain regions and industries.

Paychex has reported its fourth-quarter and full-year 2024 results, revealing solid financial performance. Total revenue grew by 5% year-over-year to $5.3 billion, with a 7% increase in operating income to $2.2 billion. Diluted EPS rose 9% to $4.67, while adjusted diluted EPS saw an 11% boost to $4.72. For Q4 alone, revenue was $1.3 billion, a 5% increase from the previous year, and operating income grew 6% to $481.8 million. Adjusted diluted EPS for Q4 rose 15% to $1.12.

The company benefited from higher interest on funds held for clients, which increased 54% to $38.2 million. Paychex also initiated cost optimization efforts, leading to a 5% increase in total expenses to $813.3 million for Q4. The company announced a fiscal 2025 outlook with expected revenue growth of 4.0%-5.5% and adjusted diluted EPS growth of 5%-7%.

Throughout fiscal 2024, Paychex maintained a strong cash position with $1.6 billion in cash and corporate investments and generated $1.9 billion in cash flow from operations. Dividends paid amounted to $3.65 per share, totaling $1.3 billion, with an additional $169.2 million spent on share repurchases.

Paychex (Nasdaq: PAYX) is set to release its fiscal 2024 fourth-quarter and full-year financial results on June 26, 2024. The announcement will be made via Business Wire before the financial markets open. A conference call to review these results is scheduled for 9:30 a.m. ET on the same day. The call will feature insights from John Gibson, President and CEO, and Bob Schrader, Senior Vice President and CFO. The live broadcast will be accessible online through the Paychex Investor Relations portal, with an archived replay available for 90 days.