Paychex (NAS:PAYX) Asset Turnover

: 0.14 (As of Feb. 2023)

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Asset Turnover measures how quickly a company turns over its asset through sales. It is calculated as Revenue divided by Total Assets. Paychex's Revenue for the three months ended in Feb. 2023 was $1,381 Mil. Paychex's Total Assets for the quarter that ended in Feb. 2023 was $9,909 Mil. Therefore, Paychex's Asset Turnover for the quarter that ended in Feb. 2023 was 0.14.

Asset Turnover is linked to ROE % through Du Pont Formula. Paychex's annualized ROE % for the quarter that ended in Feb. 2023 was 56.60%. It is also linked to ROA % through Du Pont Formula. Paychex's annualized ROA % for the quarter that ended in Feb. 2023 was 18.87%.

Paychex Asset Turnover Historical Data

The historical data trend for Paychex's Asset Turnover 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

Asset Turnover

0.46

0.47

0.46

0.49

Paychex Quarterly Data
	May18	Aug18	Nov18	Feb19	May19	Aug19	Nov19	Feb20	May20	Aug20	Nov20	Feb21	May21	Aug21	Nov21	Feb22	May22	Aug22	Nov22	Feb23
Asset Turnover																0.13	0.12	0.13	0.13	0.14

Competitive Comparison

For the Staffing & Employment Services subindustry, Paychex's Asset Turnover, along with its competitors' market caps and Asset Turnover 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.

Annual Data Quarterly Data

Paychex Asset Turnover Distribution

For the Business Services industry and Industrials sector, Paychex's Asset Turnover distribution charts can be found below:

* The bar in red indicates where Paychex's Asset Turnover falls in comparison to its industry or sector. The grey bar indicates the Asset Turnover's extreme value range as defined by GuruFocus.

Paychex Asset Turnover Calculation

Asset Turnover measures how quickly a company turns over its asset through sales.

Paychex's Asset Turnover for the fiscal year that ended in May. 2022 is calculated as

	Asset Turnover
=	Revenue	/	Average Total Assets
=	Revenue (A: May. 2022 )	/	( (Total Assets (A: May. 2021 )	+	Total Assets (A: May. 2022 ))	/ count )
=	4611.7	/	( (9227.2	+	9635.2)	/ 2 )
=	4611.7	/	9431.2
=	0.49

Paychex's Asset Turnover for the quarter that ended in Feb. 2023 is calculated as

	Asset Turnover
=	Revenue	/	Average Total Assets
=	Revenue (Q: Feb. 2023 )	/	( (Total Assets (Q: Nov. 2022 )	+	Total Assets (Q: Feb. 2023 ))	/ count )
=	1381	/	( (9214.3	+	10603.6)	/ 2 )
=	1381	/	9908.95
=	0.14

Companies with low profit margins tend to have high Asset Turnover, while those with high profit margins have low Asset Turnover. Companies in the retail industry tend to have a very high turnover ratio.

Paychex (NAS:PAYX) Asset Turnover Explanation

Asset Turnover is linked to ROE % through Du Pont Formula.

Paychex's annulized ROE % for the quarter that ended in Feb. 2023 is

	ROE %^**		(Q: Feb. 2023 )
=	Net Income	/	Total Stockholders Equity
=	1869.6	/	3303.2
=	(Net Income / Revenue)	*	(Revenue / Total Assets)	*	(Total Assets / Total Stockholders Equity)
=	(1869.6 / 5524)	*	(5524 / 9908.95)	*	(9908.95/ 3303.2)
=	Net Margin %	*	Asset Turnover	*	Equity Multiplier
=	33.85 %	*	0.5575	*	2.9998
=	ROA %	*	Equity Multiplier
=	18.87 %	*	2.9998
=	56.60 %

Note: The Net Income data used here is four times the quarterly (Feb. 2023) net income data. The Revenue data used here is four times the quarterly (Feb. 2023) revenue data.

^** The ROE % used above is for Du Pont Analysis only. It is different from the defined ROE % page on our website, as here it uses Net Income instead of Net Income attributable to Common Stockholders in the calculation.

It is also linked to ROA % through Du Pont Formula:

Paychex's annulized ROA % for the quarter that ended in Feb. 2023 is

	ROA %		(Q: Feb. 2023 )
=	Net Income	/	Total Assets
=	1869.6	/	9908.95
=	(Net Income / Revenue)	*	(Revenue / Total Assets)
=	(1869.6 / 5524)	*	(5524 / 9908.95)
=	Net Margin %	*	Asset Turnover
=	33.85 %	*	0.5575
=	18.87 %

Note: The Net Income data used here is four times the quarterly (Feb. 2023) net income data. The Revenue data used here is four times the quarterly (Feb. 2023) revenue data.

Be Aware

In the article Joining The Dark Side: Pirates, Spies and Short Sellers, James Montier reported that In their US sample covering the period 1968-2003, Cooper et al find that firms with low asset growth outperformed firms with high asset growth by an astounding 20% p.a. equally weighted. Even when controlling for market, size and style, low asset growth firms outperformed high asset growth firms by 13% p.a. Therefore a company with fast asset growth may underperform.

Therefore, it is a good sign if a company's Asset Turnover is consistent or even increases. If a company's asset grows faster than sales, its Asset Turnover will decline, which can be a warning sign.

Paychex Asset Turnover Related Terms

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Paychex (NAS:PAYX) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Business Services » Paychex Inc (NAS:PAYX) » Definitions » Asset Turnover

Comparable Companies

Traded in Other Exchanges

PAYX:Mexico PCX:Germany P1AY34:Brazil

Address

911 Panorama Trail South, Rochester, NY, USA, 14625-2396

Website

https://www.paychex.com

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.

Executives

Kevin A Price	director	911 PANORAMA TRAIL SOUTH, ROCHESTER NY 14625
Karen E. Saunders-mcclendon	officer: VP, Chief Human Resources Offi	911 PANORAMA TRAIL SOUTH, ROCHESTER NY 14625
Robert L. Schrader	officer: VP/Controller	911 PANORAMA TRAIL SOUTH, ROCHESTER NY 14625
Kara Wilson	director	C/O SUCCESSFACTORS, INC., 1500 FASHION ISLAND BLVD., SUITE 300, SAN MATEO CA 94404
Tom Bonadio	director	1021 HOWARD AVE, SAN CARLOS CA 94070
John B Gibson	officer: Sr. VP, Service	CONVERGYS CORPORATION, 201 EAST FOURTH STREET, CINCINNATI OH 45202
Mark Anthony Bottini	officer: Sr. VP of Sales	911 PANORAMA TRAIL SOUTH, ROCHESTER NY 14625
Kevin N Hill	officer: Vice President	50 WREN FIELD LN, PITTSFORD NY 114534
Michael E Gioja	officer: Sr. Vice President	911 PANORAMA TRAIL SOUTH, ROCHESTER NY 14625
Rebecca F Bernson	officer: Sr. Vice President, Sales	911 PANORAMA TRAIL SOUTH, ROCHESTER NY 14625
Efrain Rivera	officer: Sr. Vice President, CFO	911 PANORAMA TRAIL SOUTH, ROCHESTER NY 14625
Laurie L. Zaucha	officer: Vice President	400 WILLOWBROOK OFFICE PARK, FAIRPORT NY 14450
Joseph Doody	director	CASELLA WASTE SYSTEMS INC, 25 GREENS HILL LANE PO BOX 866, RUTLAND VT 05701
Delbert M Humenik	officer: Sr. Vice President	911 PANORAMA TRAIL SOUTH, ROCHESTER NY 14625
Jennifer R. Vossler	officer: VP/Controller	911 PANORAMA TRAIL SOUTH, ROCHESTER NY 14625