Most technology companies have been benefiting from an accelerated pace of digital transformation thanks to the COVID-19 pandemic. While a vaccine-driven economic recovery is expected to lead to a degree of trend reversal this year, many analysts predict the continuation of certain trends that will sustain the demand for tech offerings.
Companies that stayed afloat amid the pandemic by having their employees work remotely are now planning to make that structure permanent because they are experiencing higher productivity. Hence, the demand for new technology solutions for companies to maintain operations, stay connected with employees, and keep their people productive should keep rising.
This year could see more IT spending on cloud and edge computing infrastructure to make remote work more efficient and accessible. This, we believe, would give a boost to Paychex, Inc. (PAYX), and Akamai Technologies, Inc. (AKAM), both of which underperformed the broader market in 2020.
Paychex, Inc. (PAYX)
PAYX is a leading provider of integrated human capital management solutions for human resources (HR), payroll, benefits, and insurance services. By combining its innovative software-as-a-service technology and mobility platform, PAYX empowers small- and medium-sized business owners in the U. S. and Europe to ease HR administration for their business.
PAYX recently announced that it is offering human resource management solutions via a new integration with Fiserv’s (FISV) Clover platform. The integration enables business owners using Clover integrated with Paychex Flex to simplify payroll and time and attendance management through the Clover App. In addition , the company recently introduced additional enhancements to its platform to help clients manage risk, stay compliant, better assess performance, and adapt to mobile and artificial intelligence-driven trends.
PAYX’s revenue and EPS grew at a CAGR of 7.6% and 9.7%, respectively, over the past three years. In its fiscal second quarter ended November 31, 2020, PAYX reported total service revenue of $968.9 million, consistent with the prior year period. Management Solutions revenue was…
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