בס״ד

Payroll Payday! BBQ Fish For Everyone! (PAYX)

Posted on July 15, 2021

Today’s trade is focused on the post-Batflu recovery that everyone is convinced will happen…

One day…

Soon.

Specifically, we’re zeroing in on payroll, HR and benefits management company Paychex Inc. (NASDAQ:PAYX), the Rochester, N.Y. outfit that prospers when small business goes on a tear.

Only problem is there is no tear.

More of a RIP, actually, since no one wants to work these days.

That said, expectations are expectations, and that’s what’s driven the price of PAYX inexorably higher over the last six months – to the tune of nearly 45%.

Well that’s not right at all!

And we agree.

Particularly after a survey of the fundamentals.

Consider –

  • P/E is a lofty 37.08,
  • Dividend Yield is 2.35% (and there’s no problem there, whatsoever),
  • Although Price to Book is an egregious 13.62,
  • And Quarter over Quarter sales AND earnings have declined by 2.70% and 1.60%, respectively.

Apparently, insiders are asking the same question.

In the last six months, they’ve dumped a Valemax super-carrier $50 million worth of stock.

And not only them!  Hedge funds have unloaded shares in a hurry, too.  Since the last quarterly 13F filing, a full 20% of those hedgies holding the stock have liquidated.

Now take a peek at the chart –

May you find favor in the eyes of the Al-mighty.

Many happy returns,

Matt McAbby

 

Leave a Reply

Your email address will not be published. Required fields are marked *