Paychex stock forecast
Paychex’s weighted forecast reaches $110.58 in October 2027. It hinges on Paycor and PEO growth becoming recurring cash growth while margins stay intact and debt comes down.
Where could Paychex's shares be by 2029?
The forecast's weighted path is modestly positive, but the outcomes spread widely by 2029. The weighted price is $110.58 in October 2027, a 3% return including dividends. It reaches $118.31 in October 2028, a 15% return. By October 2029, it reaches $127.21, a 28% return. The 2029 outcomes run from $77.30 in the bear case to $177.91 in the bull case, against today's $111.63.
| Case | Probability | October 2027 | October 2028 | October 2029 |
|---|---|---|---|---|
| Bear | 25 % | 86.47 (-18 %) | 81.13 (-19 %) | 77.30 (-18 %) |
| Base | 55 % | 112.75 (+5 %) | 121.73 (+18 %) | 131.46 (+32 %) |
| Bull | 20 % | 134.77 (+25 %) | 155.36 (+49 %) | 177.91 (+74 %) |
| Weighted | 100 % | 110.58 (+3 %) | 118.31 (+15 %) | 127.21 (+28 %) |
What this means. The weighted row is the probability-based average of all three cases, not a separate likely outcome.
What has to go right or wrong for Paychex?
Earnings recover gradually in the base case. Revenue is $7,030 million in October 2027 and $7,420 million in October 2028. It reaches $7,840 million in October 2029, as pricing, added services, and Paycor synergies offset subdued payroll activity. Net margins rise from 27.7% to 28.2%, then reach 28.7%, allowing earnings to move from $1,947 million to $2,249 million. The path reflects 5%–6% revenue guidance and 7%–9% adjusted EPS guidance, alongside FY2026 adjusted net income of $1,984.8 million and more than $100 million of reported synergies.
The bear case uses revenue of $6,890 million in 2027 and $7,130 million in 2028. It reaches $7,380 million in 2029. Margins fall from 25.5% to 24.5%, then 24.0%, as insurance costs, interest, and weak operating leverage reduce earnings. The bull case reaches $7,160 million in 2027 and $7,640 million in 2028, then $8,175 million in 2029. Margins rise from 28.8% to 29.5%, then 30.0%, because cross-selling and productivity gains prove durable.
How much cash does Paychex really make?
Free cash flow means operating cash flow after capital spending, including internally developed software. Payroll processing needs less physical infrastructure than manufacturing, but software remains a real cash requirement. Cash flow also exceeds net income when amortization and other noncash expenses reduce profit without requiring another payment in the current year.
Stock compensation needs a separate lens. Employees receive value, while shareholders bear dilution, so deducting stock pay from free cash flow is a useful analytical allowance even though it is not another bank payment.
| May 2026 | May 2025 | May 2024 | May 2023 | May 2022 | |
|---|---|---|---|---|---|
| Cash from operations | 2,556.7 | 1,900.9 | 1,897.7 | 1,706.2 | 1,589.7 |
| − Capital spending | 234.9 | 191.8 | 161.4 | 143.0 | 133.8 |
| = Free cash flow | 2,321.8 | 1,709.1 | 1,736.3 | 1,563.2 | 1,455.9 |
| − Stock pay | 96.1 | 111.8 | 61.1 | 62.6 | 52.8 |
| = Real free cash flow | 2,225.7 | 1,597.3 | 1,675.2 | 1,500.6 | 1,403.1 |
| Real free cash flow, % of revenue | 34.2% | 28.7% | 31.7% | 30.0% | 30.4% |
What this means. The company's own free cash flow is lower than ours in 2023 and 2022 because its older calculation subtracts some cash items and uses different cash-flow classifications.
What does an investor pay for Paychex today?
| Today (Oct 19, 2026) | |
|---|---|
| Share price | 111.63 |
| Market value (calculated) | 39,738.1 |
| Enterprise value (calculated) | 43,403.9 |
| P/E, last 12 months (calculated) | 22.1x |
| P/E, next 12 months (calculated) | 18.7x |
| Free cash flow yield (calculated) | 5.8% |
What this means. The next 12 months price-to-earnings figure uses analysts’ expected profit, so it is a forecast rather than a known result.