Morgan Stanley Affirms ‘Equal Weight’ on Paychex on PayCor Integration

Paychex, Inc. (NASDAQ:PAYX) is one of the best 52-week high stocks to buy, according to analysts. On June 10, Morgan Stanley reiterated an ‘Equal Weight’ on the stock and maintained a $150 price target. The firm’s stance is in response to the acquisition of PayCor for $4.1 billion as it seeks to enhance its AI-enabled technology and service capabilities.

According to Morgan Stanley, the acquisition will likely trigger a 5% and 3% decrease in forecasted diluted earnings per share for fiscal 2026 and 2027. Despite the downward adjustment, the firm has reiterated a $150 price target, attributing it to higher earnings multiple of 27 times up from 25 times.

Morgan Stanley is confident of the sustained strength of the demand and employment landscape as the PayCor acquisition is poised to increase Paychex’s total addressable market. The analysts expect the integration to contribute positively to the company’s business by broadening service offerings and reaching new customer segments.

The strategic acquisition is also expected to bolster Paychex’s position in the market by tapping PayCor’s existing customer base and technology solutions. The acquisition is also part of a broader strategy that seeks to capture more market share and drive growth.

Paychex, Inc. (NASDAQ:PAYX) provides integrated human capital management solutions (HCM) for payroll, benefits, human resources (HR), and insurance services for small to medium-sized businesses. It offers payroll processing, tax administration, employee payment, and regulatory compliance services.

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