Paychex, the leading human-resources company, is set to announce its results for the fiscal first quarter before the bell on Wednesday. Here’s a summary of what you need to know.
Profit Outlook
According to FactSet, Paychex is expected to report a profit of $406 million for the quarter, compared to $379.2 million in the same period last year.
Earnings Expectation
Analysts surveyed by FactSet anticipate earnings of $1.12 per share, which is an increase from $1.05 per share reported in the year-ago quarter.
Revenue Projection
FactSet projects a rise in revenue to $1.28 billion, up from $1.21 billion in the previous year.
Key Areas of Interest
Worksite Employees:
Paychex’s management solutions business experienced revenue growth in the fiscal fourth quarter due to an increase in the number of clients and worksite employees served. Investors are keen to see if this trend continues in the current quarter, especially with the tight labor market conditions.
Wages:
The top line of Paychex’s employer organization and insurance solutions business was boosted by growth in average wages for worksite employees. Investors will be watching closely to see if this trend persists, despite the moderate wage growth.
Costs:
Investors are also interested in monitoring expenses, particularly after the company experienced higher compensation costs last quarter. These costs were primarily attributed to an increased headcount, wages, and investments in product development, technology, and marketing.
