I remain upbeat about the shares of Paychex (PAYX), a leading US provider of payroll, human resources, insurance, and benefits outsourcing solutions for small- to medium-sized businesses. The company’s financials for its fiscal 2017 first quarter ended Aug 31 were decent. Revenues increased 8.6% y-o-y to $785.5 mn and surpassed consensus estimate of $782 mn. Payroll Service segment revenues went up 4% to $450.9 mn, primarily on the back of higher revenue per check and client base. The acquisition of Advanced Partners contributed approximately 1% to the segment’s revenue growth. Human Resource Services revenues jumped 15% to $322.6 mn mainly driven by solid growth in client base and worksite employees, increased revenues from retirement and online HR administration services. Operating income increased 9.1% to $323 mn, and operating margin improved 10 basis points to 41.1%. Earnings per share rose 3% to 60 cents beating analysts’ average projection by 3 cents.Paychex financial position remained strong, with cash and total corporate investments of $497.7 mn and no long-term debt at the quarter-end. In FQ1, the company generated operating cash flow of $294.7 mn and paid $166.3 mn as dividends, which a quarterly dividend of 46 cents per share offering a healthy annualized dividend yield of 3.3%. Besides, In July, the company approved a new $350 mn share repurchase program.Paychex updated its FY2017 guidance and expects total service revenues to increase 7-8% y-o-y. Payroll Service revenues growth is forecast in the range of 3-4%, while Human Resource Services revenues are anticipated to rise 12-14%. Net income is likely to grow 7%. After a significant decline, Paychex’s shares have found support near $55 level. I expect to stock to rebound, with medium-term target at $60. $PAYX, Paychex, Inc. / 1440