Paychex Inc. Beats Earnings Estimates (PAYX)

Paychex Inc. (PAYX) reports Q3 earnings of $0.36 versus consensus of $0.34. Paychex Inc. reports revenues of $518.3 million versus consensus of $507.53 million. The company's guidance at that time was as follows: “We project that payroll service revenue for fiscal 2011 will be flat compared to fiscal 2010. Human Resource Services revenue is anticipated to increase in the range of 10% to 13%. Interest on funds held for clients is expected to decrease in the range of 12% to 17%, while investment income, net is expected to increase in the range of 24% to 27%. Operating income, net of certain items, as a percentage of total service revenue is expected to range from 34% to 35% for fiscal 2011. The effective income tax rate is expected to approximate 35% for fiscal 2011. Net income is expected to improve slightly over fiscal 2010.” B. Thomas Golisano, Chairman of the Board of Directors, commented, "Our first quarter was slightly better than expected. Our client retention has improved. Sales of new units continue to be difficult, but we are implementing changes to our sales process that should enable us to improve sales productivity in the near future. Our first quarter results are encouraging; however, we remain cautious on fiscal 2011. We will monitor how the year evolves before determining any changes to our June 2010 guidance." Shares of PAYX are higher in the after-hours by 0.30%.