Dividend.com: Paychex Stubbed

Lennar is not recommended at this time, holding a Dividend.com Rating of 2.8 out of 5 stars.

Paychex Results Sheds Light on Business Environment

Paychex(PAYX Quote) reported late Wednesday that its second quarter profit fell nearly 5% to $140.2 million, or 39 cents a share, compared with net income of $147.1 million, or 40 cents a share, in the year-earlier period.

Revenue was up 3.2% to $524.2 million from $507.8 million, but below analyst expectations of $533 million. The company revealed some good stats on how businesses are being affected by the current economic crisis: Companies going out of business increased 12%, new business starts declined 13% and checks per client decreased 1.5% -- easily attributable to layoffs.

Going forward, management expects revenue growth of 2% to 4% and net income decline of 7% to 5%.

We had removed shares of Paychex from our "Recommended" list on Oct. 8, when the stock was trading at $28.91. The company has a 4.66% dividend yield, based on last night's closing stock price of $26.61. We think the stock is getting interesting here, especially if we get a pull-back to the next technical support area of $22 to $23. We'll keep subscribers posted.

Paychex is not recommended at this time, holding a Dividend.com Rating of 3.4 out of 5 stars.

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