Paychex Inc (PAYX)
Return on assets (ROA)
| May 31, 2025 | May 31, 2024 | May 31, 2023 | May 31, 2022 | May 31, 2021 | ||
|---|---|---|---|---|---|---|
| Net income | US$ in thousands | 1,657,300 | 1,690,400 | 1,557,300 | 1,392,800 | 1,097,500 |
| Total assets | US$ in thousands | 16,564,100 | 10,383,100 | 10,546,400 | 9,635,200 | 9,227,200 |
| ROA | 10.01% | 16.28% | 14.77% | 14.46% | 11.89% |
May 31, 2025 calculation
ROA = Net income ÷ Total assets
= $1,657,300K ÷ $16,564,100K
= 10.01%
The analysis of Paychex Inc.'s return on assets (ROA) over the specified period reveals notable fluctuations and a general trend of growth followed by a decline. As of May 31, 2021, the ROA stood at 11.89%, indicating the company's efficiency in generating net income from its assets at that point in time. By May 31, 2022, the ROA increased significantly to 14.46%, reflecting improved profitability and asset utilization. This upward trajectory continued into 2023, with the ROA reaching 14.77%, suggesting sustained operational efficiency and effective asset management.
The upward trend persisted into May 2024, where the ROA further increased to 16.28%, the highest value within the analyzed period. This indicates that in this particular year, Paychex Inc. was exceptionally effective in converting its assets into net income, possibly due to favorable operational conditions or strategic initiatives. However, in the subsequent year ending May 31, 2025, the ROA declined markedly to 10.01%. This decrease could signal challenges in maintaining previous efficiency levels, potentially attributed to changes in revenue, increased assets, or other operational factors.
Overall, the data depicts a period of strong asset efficiency gains from 2021 through 2024, followed by a sharp reduction in 2025. The peaks and subsequent decline suggest possible shifts in operational performance or external market conditions influencing profitability relative to assets.