We recently published a list of Jim Cramer’s Game Plan: 9 Stocks in Focus. In this article, we are going to take a look at where Paychex, Inc. (NASDAQ:PAYX) stands against other stocks that Jim Cramer discussed.
Jim Cramer, host of Mad Money, reviewed the most significant market events for this week on Friday, including earnings reports from various companies. He also pointed out that Wall Street’s anxiety is expected to persist as uncertainty over tariff policies continues.
“Looking forward to next week for a game plan, I’m focused on the unrelenting negativity and how it’s bringing about real but ignored values, ignored because it’s very hard to buy stocks ahead of the tariffs and a Fed that’s no longer willing to help by cutting interest rates, at least for the moment.”
READ ALSO: 9 Stocks on Jim Cramer’s Radar and Jim Cramer Discussed These 10 Stocks Recently
Cramer highlighted that on Thursday, pending home sales will be reported, which could offer a clearer picture of the housing market’s current state. He mentioned that while some companies are reporting troubling signs, it is important to assess whether these are isolated issues or part of a broader slowdown in the housing market.
The data could provide the much-needed clarity that the Federal Reserve cares about, especially since there is a lot of uncertainty surrounding the housing sector. In addition to the home sales data, Cramer pointed out that personal consumption expenditure (PCE) numbers will also be released on Thursday. He said that the PCE is the Federal Reserve’s preferred measure of inflation, but Cramer noted:
“Unfortunately, hasn’t been a good one. Sentiment … seems to be turning south.”
Although, he admitted that it is hard to say for certain. The global geopolitical concerns are contributing to this uncertainty, but Cramer stressed that hard data to support this shift in sentiment is still lacking. Cramer also mentioned that he is especially looking forward to the University of Michigan Consumer Sentiment Index, which is set to be released on Friday. The data could provide valuable insight into the public’s mood, and if the numbers are significantly negative, it would confirm the downtrend he has been seeing in the market over the past few weeks.
“So here’s the bottom line: There’s a lot going on next week, but until we get some resolution on the trade front, you need to expect more uncertainty, more volatility like we saw today. There’s just too much negativity, and for the moment it seems impossible to fight it. Although when it gets extreme for no reason as it did this morning, you still have to pounce if only for a trade.”
Our Methodology
For this article, we compiled a list of 9 stocks that were discussed by Jim Cramer during the episode of Mad Money aired on March 21. We listed the stocks in the order that Cramer mentioned them. We also provided hedge fund sentiment for each stock as of the fourth quarter of 2024, which was taken from Insider Monkey’s database of over 1,000 hedge funds.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A man in a suit presenting HR Solutions to a satisfied corporate client.
Paychex, Inc. (NASDAQ:PAYX)
Number of Hedge Fund Holders: 36
Cramer’s worries for companies like Paychex, Inc. (NASDAQ:PAYX) were apparent as he said:
“We got a pair of small business-oriented companies that will report Wednesday, Cintas and Paychex… As for Paychex, this payroll processor has a lot of bearish analysts covering it and I gotta tell you something, they got smoked in that last quarter, just smoked by the great numbers. Paychex, I think it’s going to continue to do well.”
Paychex (NASDAQ:PAYX) offers integrated human capital management solutions, including payroll, HR, benefits, insurance, and retirement plan administration, with a focus on serving small to medium-sized businesses. As per its outlook for the fiscal year 2025, the company expects total revenue to grow by 4% to 5.5% in fiscal year 2025.
Paychex (NASDAQ:PAYX) anticipates interest on client funds will range from $145 million to $155 million, with other net income between $30 million and $35 million. Operating income margin is projected to be between 42% and 43%, leaning toward the higher end. It also expects adjusted diluted earnings per share to grow by 5% to 7%.
Overall, PAYX ranks 6th on our list of stocks that Jim Cramer discussed. While we acknowledge the potential of PAYX as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than PAYX but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
