PEG Ratio is defined as the PE Ratio without NRI divided by the growth ratio. The growth rate we use is the 5-Year EBITDA growth rate. As of today, Paychex's PE Ratio without NRI is 26.07. Paychex's 5-Year EBITDA growth rate is 7.20%. Therefore, Paychex's PEG Ratio for today is 3.62.
* The 5-Year EBITDA Growth Rate is the 5-year average EBITDA per share growth rate. While the denominator is a percentage, we use the whole number as opposed to the decimal form for the calculation. For example, 5% would be shown as 5 as opposed to 0.05. If it's smaller than or equal to 0, then the PEG Ratio is not calculated.
The historical rank and industry rank for Paychex's PEG Ratio or its related term are showing as below:
PAYX'
s PEG Ratio Range Over the Past 10 Years
Min: 2.16 Med: 3.7 Max: 6.41
Current: 3.62
During the past 13 years, Paychex's highest PEG Ratio was 6.41. The lowest was 2.16. And the median was 3.70.
PAYX's PEG Ratio is ranked worse than 77.28% of 405
companies
in the Business Services industry
Industry Median: 1.42
vs PAYX: 3.62
Peter Lynch thinks a company with a P/E ratio equal to its growth rate is fairly valued.
Paychex PEG Ratio Historical Data
The historical data trend for Paychex's PEG Ratio can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
* Premium members only.
Paychex Annual Data
Trend
May13
May14
May15
May16
May17
May18
May19
May20
May21
May22
PEG Ratio
2.99
3.99
3.07
5.55
4.43
Paychex Quarterly Data
May18
Aug18
Nov18
Feb19
May19
Aug19
Nov19
Feb20
May20
Aug20
Nov20
Feb21
May21
Aug21
Nov21
Feb22
May22
Aug22
Nov22
Feb23
PEG Ratio
4.64
4.43
3.97
3.73
3.11
Competitive Comparison
For the Staffing & Employment Services subindustry, Paychex's PEG Ratio, along with its competitors' market caps and PEG Ratio data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Paychex PEG Ratio Distribution
For the Business Services industry and Industrials sector, Paychex's PEG Ratio distribution charts can be found below:
* The bar in red indicates where Paychex's PEG Ratio falls in comparison to its industry or sector. The grey bar indicates the PEG Ratio's extreme value range as defined by GuruFocus.
Paychex PEG Ratio Calculation
PEG Ratio is defined as the PE Ratio without NRI divided by the growth ratio.
The ratio we use is the 5-Year EBITDA growth rate.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
* Note: The 5-Year EBITDA Growth Rate is the 5-year average EBITDA per share growth rate. While the denominator is a percentage, we use the whole number as opposed to the decimal form for the calculation. For example, 5% would be shown as 5 as opposed to 0.05. If it's smaller than or equal to 0, then the PEG Ratio is not calculated.
Paychex (NAS:PAYX) PEG Ratio Explanation
To compare stocks with different growth rates, Peter Lynch invented a ratio called PEG Ratio. PEG Ratio is defined as the P/E ratio divided by the growth ratio. He thinks a company with a P/E ratio equal to its growth rate is fairly valued. Still he said he would rather buy a company growing 20% a year with a P/E of 20, instead of a company growing 10% a year with a P/E of 10.
Paychex PEG Ratio Related Terms
Thank you for viewing the detailed overview of Paychex's PEG Ratio provided by GuruFocus.com. Please click on the following links to see related term pages.
Paychex is a leading provider of payroll, human capital management, and insurance solutions servicing small and midsize clients primarily in the United States. The company, established in 1979, services over 730,000 clients and pays over 1 in 12 U.S. private-sector workers. Alongside its traditional payroll services, Paychex offers HCM solutions such as benefits administration and time and attendance software, as well as human resources outsourcing and insurance agency services.
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