4-Star Stocks Poised to Pop: Paychex (PAYX)

4-Star Stocks Poised to Pop: Paychex

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, payroll and personnel services provider Paychex (Nasdaq: PAYX ) has earned a respected four-star ranking.

With that in mind, let's take a closer look at Paychex's business and see what CAPS investors are saying about the stock right now.

Paychex facts

Headquarters (Founded)	Rochester, N.Y. (1971)
Market Cap	$11.4 billion
Industry	Data processing and outsourced services
Trailing-12-Month Revenue	$2.2 billion
Management	Founder/Chairman Thomas Golisano CEO Martin Mucci
Return on Equity (Average, Past 3 Years)	35.8%
Cash/Debt	$411.1 million / $0
Dividend Yield	4%
Competitors	ADP Insperity TriNet Group

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 95% of the 1,519 members who have rated Paychex believe the stock will outperform the S&P 500 going forward.

Late last year, one of those Fools, scoobster007, nicely summed up the bull case for our community:

[Paychex] will outperform in both the short term (several months) and the longer term (3-4 years). It has no debt, expenses are in line, it keeps coming up with new ways to earn money either organically or through purchases. It is profitable and will become more so as it grows over the next several years. Once the economy starts to improve, it will do much better than the market for these reasons and also because it will begin to earn a lot more money on its "float"; that is the money it holds for its clients until it is time to pay their employees etc.

Of course, despite its four-star rating, Paychex may not be your top choice. If that's the case, we've compiled a special free report for investors called "Secure Your Future With 11 Rock-Solid Dividend Stocks," which uncovers several other juicy income opportunities. The report is 100% free, but it won't be around forever, so click here to access it now.

Want to see how well (or not so well) the stocks in this series are performing? Follow the new TrackPoisedTo CAPS account.

The Steve Jobs Betrayal
You may already know that in the final year of his life, Jobs revealed a stunning betrayal — and told his biographer, "I will spend my last dying breath... and every penny of Apple's $40 billion in the bank to right this wrong." What was it that made Jobs so irate — and why could it make a few in-the-know investors some major profits over the coming months and years?

Enter your email address below to find out what made Jobs so enraged!

Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Motley Fool newsletter services have recommended buying shares of Paychex and ADP. Motley Fool newsletter services have also recommended creating a write covered strangle position in Paychex. Try any of our Foolish newsletter services free for 30 days.

We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment icon found on every comment.