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Paychex Inc. (PAYX): Today's Featured Diversified Services Laggard

Tickers in this article: PAYX

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model

Paychex ( PAYX) pushed the Diversified Services industry lower today making it today's featured Diversified Services laggard. The industry as a whole closed the day down 0.4%. By the end of trading, Paychex fell $0.41 (-1.1%) to $35.87 on average volume. Throughout the day, 2,098,437 shares of Paychex exchanged hands as compared to its average daily volume of 2,756,000 shares. The stock ranged in price between $35.85-$36.31 after having opened the day at $36.23 as compared to the previous trading day's close of $36.28. Other companies within the Diversified Services industry that declined today were: DLH Holdings ( DLHC), down 11.4%, ITT Educational Services ( ESI), down 11.3%, Pointer Telocation ( PNTR), down 9.1% and VirtualScopics ( VSCP), down 8.1%.

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Paychex, Inc., together with its subsidiaries, provides payroll, human resource, and benefits outsourcing solutions for small to medium-sized businesses in the United States and Germany. Paychex has a market cap of $13.1 billion and is part of the services sector. The company has a P/E ratio of 23.1, above the S&P 500 P/E ratio of 17.7. Shares are up 16.7% year to date as of the close of trading on Thursday.

TheStreet Ratings rates Paychex as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, growth in earnings per share, increase in net income and expanding profit margins. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results.

On the positive front, Websense ( WBSN), down 15.3%, VCA Antech ( WOOF), down 10.9%, SPS Commerce ( SPSC), down 10.9% and HMS Holdings Corporation ( HMSY), down 6.8% , were all gainers within the diversified services industry with H&R Block ( HRB) being today's featured diversified services industry leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the diversified services industry could consider iShares Dow Jones US Cons Services ( IYC) while those bearish on the diversified services industry could consider ProShares Ultra Short Consumer Sers ( SCC).