Paychex, Inc. Fundamental Analysis (XETRA: PCX.DE)
Paychex, Inc. Fundamental Analysis (XETRA: PCX.DE)
Paychex, Inc. (XETRA: PCX.DE) shows strong financial fundamentals with a PE ratio of 23.50, profit margin of 27.35%, and ROE of 46.96%. The company generates $6.6B in annual revenue with moderate year-over-year growth of 5.56%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 62.9/100 based on profitability, valuation, growth, and balance sheet metrics. The C+ grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze PCX.DE's fundamental strength across five key dimensions:
Efficiency Score
ExcellentPCX.DE demonstrates superior asset utilization.
Valuation Score
ExcellentPCX.DE trades at attractive valuation levels.
Growth Score
ModeratePCX.DE shows steady but slowing expansion.
Financial Health Score
ModeratePCX.DE shows balanced financial health with some risks.
Profitability Score
ExcellentPCX.DE achieves industry-leading margins.
Key Financial Metrics
Is PCX.DE Expensive or Cheap?
P/E Ratio
PCX.DE trades at 23.50 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, PCX.DE's PEG of 1.71 indicates fair valuation.
Price to Book
The market values Paychex, Inc. at 11.37 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 13.05 times EBITDA. This signals the market has high growth expectations.
How Well Does PCX.DE Make Money?
Net Profit Margin
For every $100 in sales, Paychex, Inc. keeps $27.35 as profit after all expenses.
Operating Margin
Core operations generate 40.37 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $46.96 in profit for every $100 of shareholder equity.
ROA
Paychex, Inc. generates $11.51 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Paychex, Inc. generates strong operating cash flow of $2.24B, reflecting robust business health.
Free Cash Flow
Paychex, Inc. generates strong free cash flow of $2.01B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $5.65 in free cash annually.
FCF Yield
PCX.DE converts 4.76% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
23.50
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
1.71
vs 25 benchmark
P/B Ratio
Price to book value ratio
11.37
vs 25 benchmark
P/S Ratio
Price to sales ratio
6.40
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
1.25
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.28
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.47
vs 25 benchmark
ROA
Return on assets percentage
0.12
vs 25 benchmark
ROCE
Return on capital employed
0.29
vs 25 benchmark
How PCX.DE Stacks Against Its Sector Peers
| Metric | PCX.DE Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 23.50 | 27.18 | Better (Cheaper) |
| ROE | 46.96% | 1167.00% | Weak |
| Net Margin | 27.35% | 44.00% | Weak |
| Debt/Equity | 1.25 | 0.75 | Weak (High Leverage) |
| Current Ratio | 1.28 | 21.97 | Neutral |
| ROA | 11.51% | -1343549.00% (disorted) | Strong |
PCX.DE outperforms its industry in 2 out of 6 key metrics, particularly excelling in ROA, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Paychex, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
37.25%
Industry Style: Cyclical, Value, Infrastructure
High GrowthEPS CAGR
50.21%
Industry Style: Cyclical, Value, Infrastructure
High GrowthFCF CAGR
34.77%
Industry Style: Cyclical, Value, Infrastructure
High Growth