Paychex dividend: history, cash cover and yield
Paychex's dividend rose from $2.77 to $4.43 historically, with the forecast showing $4.87 per share in 2027 and $5.79 by 2029. In fiscal 2026, $2,321.8 million of free cash flow covered $1,589.6 million of dividends, while dividends and repurchases left $121.2 million before other uses.
How much does Paychex pay in dividends?
Dividends rise from $4.87 per share in the base case to $5.79 by 2029. That is slower than the historical increase from $2.77 to $4.43, because dividends and buybacks already consumed 94.8% of FY2026 free cash flow. The bear freezes the current $1.19 quarterly rate at $4.76 annually. The bull reaches $6.14 by 2029 through increases near the recent 10% pace.
| May 2026 | May 2025 | May 2024 | May 2023 | May 2022 | |
|---|---|---|---|---|---|
| Revenue | 6,512.0 | 5,571.7 | 5,278.3 | 5,007.1 | 4,611.7 |
| Revenue growth (calculated) | 16.9% | 5.6% | 5.4% | 8.6% | 13.7% |
| EPS, diluted | 4.89 | 4.58 | 4.67 | 4.30 | 3.84 |
| Dividend per share | 4.43 | 4.02 | 3.65 | 3.26 | 2.77 |
What this means. The jump in sales in May 2026 looks unusually large because buying Paycor added about twelve percentage points to the growth.
Is Paychex's dividend covered by its cash?
Fiscal 2026 free cash flow was $2,321.8 million. Dividends of $1,589.6 million and repurchases of $611.0 million left $121.2 million before other uses. Deducting stock pay leaves still less economic cash available for debt reduction.
| May 2026 | May 2025 | May 2024 | May 2023 | May 2022 | |
|---|---|---|---|---|---|
| Free cash flow | 2,321.8 | 1,709.1 | 1,736.3 | 1,563.2 | 1,455.9 |
| − Dividends paid | 1,589.6 | 1,448.5 | 1,315.3 | 1,175.0 | 999.6 |
| − Share buybacks | 611.0 | 104.5 | 169.2 | 0 | 145.2 |
| = Free cash flow not paid out | 121.2 | 156.1 | 251.8 | 388.2 | 311.1 |
| Paid out, % of free cash flow | 94.8% | 90.9% | 85.5% | 75.2% | 78.6% |
What this means. The company's own net debt or net cash differs from ours because it includes restricted cash and all corporate investments and subtracts borrowing fees from debt, while ours uses the table's cash and short-term investments and total debt.
What could change Paychex's dividend?
The base case would strengthen if FY2027 revenue grows 5%–6% and adjusted EPS grows 7%–9%, while Paycor retention and synergies keep the adjusted operating margin near 44%. The bull case would gain credibility through FY2028–FY2029 if WISE Hire adoption, recurring cross-selling, controlled insurance costs, and stronger free cash flow appear together.
| October 2027 | October 2028 | October 2029 | |
|---|---|---|---|
| Earnings | 1,947 (1,757 / 2,062) | 2,092 (1,747 / 2,254) | 2,249 (1,771 / 2,453) |
| Shares (millions) | 354 (356 / 352) | 352 (355 / 348) | 351 (355 / 345) |
| Dividends per share | 4.87 (4.76 / 4.98) | 5.31 (4.76 / 5.53) | 5.79 (4.76 / 6.14) |
| Price to earnings | 20.50 (17.50 / 23.00) | 20.50 (16.50 / 24.00) | 20.50 (15.50 / 25.00) |
What is Paychex's dividend yield against its share price?
Today’s price is plausible if Paychex sustains cash growth, protects its margins and uses the cash left after dividends to manage debt.