Why Paychex (PAYX) Is Gaining After Hours

NEW YORK (TheStreet) -- Human resources specialist Paychex (PAYX) is climbing in extended trading after reporting third-quarter results above analysts' estimates.

After the bell, shares added 2.7% to $43.06.

The company, which provides payroll, benefits and outsourcing support, recorded net income of 44 cents a share, 2 cents higher than averages compiled by Yahoo! Finance.

Revenue climbed 7.3% year on year to $636.5 million, beating estimates by $7.65 million.

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TheStreet Ratings team rates PAYCHEX INC as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:

"We rate PAYCHEX INC (PAYX) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, expanding profit margins, good cash flow from operations, growth in earnings per share and increase in net income. We feel these strengths outweigh the fact that the company is trading at a premium valuation based on our review of its current price compared to such things as earnings and book value."

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