Paychex's Stock Climbs After Profit, Sales Beat Expectations

Paychex Inc.'s stock climbed 2.2% in premarket trade Wednesday, after the human resources services company reported fiscal first-quarter profit and revenue that beat expectations. For the quarter ended Aug. 31, earnings rose to $209.1 million, or 58 cents a share, from $171.3 million, or 47 cents a share, in the same period a year ago. The FactSet consensus for earnings per share was 51 cents. Total revenue increased 8% to $723 million, above the FactSet consensus of $718 million, with revenue from its payroll service and human resource service businesses both increasing more than expected. The company said it expects full fiscal-year payroll service revenue growth of 4% to 5% and human resource service revenue to increase 10% to 13% from a year ago. The current FactSet consensus estimates implies payroll service revenue growth of 4.3% and human resource revenue growth of 12%. The stock has slipped 1.9% over the past three months through Tuesday, while the S&P 500 has declined 8.7%.