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Paychex earnings top estimates; revenues rise but slightly below estimates

Paychex is reporting fiscal third quarter results that beat Wall Street estimates in terms of earnings per share.

The company earned $202 million for the quarter, up 12 percent from a year ago, or 56 cents per share. The analysts’ average estimate was 54 cents.

Revenues of more than $782 million were 6 percent higher than last year, but came in slightly less than analysts expected.

Paychex President & CEO Martin Mucci says that it was a solid quarter for the company.

He tells WXXI News that sales were a little slower in some areas, but that is partly because last year at this time was such a strong quarter for Paychex due to concerns from businesses about complying with the ACA, so the comparison can make sales seem a bit weaker in the most recent quarter.

Mucci says the various HR services that Paychex provides continue to be a big revenue driver, especially time and attendance services.

“Some of that started with the overtime rules that were going to go into effect, but even though they have not (yet)  I think many clients have said there is a real need for tracking of time; they also see that there are a number of regulations  that are coming up on the state level, as federal regulations go down , we’re seeing states go up, which is going to make it even more complicated.”

In terms of job growth at the small and medium sized businesses that Paychex serves, Mucci says the company has seen some job creation in small businesses, and they expect those levels to increase in the coming months.

Randy Gorbman is WXXI's director of news and public affairs. Randy manages the day-to-day operations of WXXI News on radio, television, and online.