NEW YORK ( TheStreet) -- If the below graph from the Bureau of Labor Statistics is believable, U.S. unemployment is dropping as the number of people employed is rising.It would seem that companies providing human resources and payroll processing functions may be a growth industry. Monday, I noticed Paychex ( PAYX), a human resources and payroll processing company, was high on the list of Nasdaq 100 stocks consistently hitting new highs.
Investor interest: Professional analyst have issued one strong buy, 18 hold, two underperform and three sell recommendations. The individual investor on Motley Fool is more bullish and 1,537 investors gave the stock a 95% vote to beat the market. Short sellers have increased their positions slightly from 17.3 million shares at the end of last year to about 19.7 million shares recently. If the price continues to increase they might have to cover those positions Peer comparison: In the last year, while Paychex was up 14%, Accenture ( ACN) was up 21%, Automatic Data Processing ( ADP) up 19% and Infosys ( INFY) down 8%.
Conclusion: Payroll numbers are climbing slowly and so has the price of Paychex. This looks to be a slow and steady play and if you enter at this point. Carefully monitor the stock's moving averages and the 14-day turtle channel for price weakness: