Paychex (PAYX) Competitors

Paychex (NASDAQ:PAYX) and Automatic Data Processing (NASDAQ:ADP) are both large-cap computer and technology companies, but which is the superior stock? We will contrast the two businesses based on the strength of their media sentiment, institutional ownership, profitability, dividends, valuation, earnings, risk and analyst recommendations.

Is PAYX or ADP a better dividend stock?

Paychex pays an annual dividend of $4.32 per share and has a dividend yield of 2.9%. Automatic Data Processing pays an annual dividend of $6.16 per share and has a dividend yield of 2.0%. Paychex pays out 94.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Automatic Data Processing pays out 63.1% of its earnings in the form of a dividend. Paychex has increased its dividend for 3 consecutive years and Automatic Data Processing has increased its dividend for 49 consecutive years.

Does the media prefer PAYX or ADP?

In the previous week, Automatic Data Processing had 31 more articles in the media than Paychex. MarketBeat recorded 53 mentions for Automatic Data Processing and 22 mentions for Paychex. Paychex's average media sentiment score of 1.24 beat Automatic Data Processing's score of 1.02 indicating that Paychex is being referred to more favorably in the media.

Company	Very Positive	Positive	Neutral	Negative	Very Negative	Overall Sentiment
Paychex	19 Very Positive mention(s)	0 Positive mention(s)	3 Neutral mention(s)	0 Negative mention(s)	0 Very Negative mention(s)	Positive
Automatic Data Processing	42 Very Positive mention(s)	0 Positive mention(s)	4 Neutral mention(s)	7 Negative mention(s)	0 Very Negative mention(s)	Positive

Which has stronger earnings & valuation, PAYX or ADP?

Automatic Data Processing has higher revenue and earnings than Paychex. Automatic Data Processing is trading at a lower price-to-earnings ratio than Paychex, indicating that it is currently the more affordable of the two stocks.

Company	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Paychex	$5.57B	9.50	$1.66B	$4.57	32.17
Automatic Data Processing	$19.04B	6.59	$3.75B	$9.77	31.62

Do analysts recommend PAYX or ADP?

Paychex currently has a consensus target price of $149.11, suggesting a potential upside of 1.42%. Automatic Data Processing has a consensus target price of $307.08, suggesting a potential downside of 0.61%. Given Paychex's higher probable upside, equities analysts clearly believe Paychex is more favorable than Automatic Data Processing.

Company	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Paychex	1 Sell rating(s)	9 Hold rating(s)	0 Buy rating(s)	0 Strong Buy rating(s)	1.90
Automatic Data Processing	1 Sell rating(s)	8 Hold rating(s)	3 Buy rating(s)	0 Strong Buy rating(s)	2.17

Do insiders & institutionals have more ownership in PAYX or ADP?

83.5% of Paychex shares are held by institutional investors. Comparatively, 80.0% of Automatic Data Processing shares are held by institutional investors. 11.4% of Paychex shares are held by company insiders. Comparatively, 0.2% of Automatic Data Processing shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a company will outperform the market over the long term.

Is PAYX or ADP more profitable?

Paychex has a net margin of 29.75% compared to Automatic Data Processing's net margin of 19.79%. Automatic Data Processing's return on equity of 77.33% beat Paychex's return on equity.

Company	Net Margins	Return on Equity	Return on Assets
Paychex	29.75%	45.01%	14.77%
Automatic Data Processing	19.79%	77.33%	7.18%

Which has more volatility & risk, PAYX or ADP?

Paychex has a beta of 0.88, meaning that its share price is 12% less volatile than the S&P 500. Comparatively, Automatic Data Processing has a beta of 0.76, meaning that its share price is 24% less volatile than the S&P 500.

Summary

Paychex beats Automatic Data Processing on 10 of the 19 factors compared between the two stocks.