Barclays Maintains an 'Equalweight' on Paychex (PAYX); Strong F1Q; FY12 Guidance Unchanged

Barclays maintains an 'Equalweight' on Paychex (NASDAQ: PAYX) price target of $30.00.

Barclays analyst says, "Last night, Paychex reported stronger-than-expected F1Q'12 results with revenue and margins solidly above estimates, which drove a $0.03 EPS surprise. PAYX maintained its prior FY12 guidance and expects some deceleration in future quarters due to tougher comps and expected investments."

"We are raising our FY12 EPS estimate by $0.02 and now estimate FY12-13 EPS of $1.52/$1.66, or 7%/9% y/y growth. While results continue to modestly improve, low interest rates and a sluggish employment recovery are likely to constrain near-term growth. As a result, we find PAYX fairly valued at 18.0x/16.8x our CY11-12 EPS estimates."

For more ratings news on Paychex click here and for the rating history of Paychex click here.

Shares of Paychex closed at $26.69 yesterday.

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