# Paychex Dividend Growth Slowing

> Paychex's dividend growth may slow as safety margin shrinks.
- Title: Paychex Dividend Growth Slowing · 24/7 Wall St. | Shortify
- Summary: Paychex's dividend growth may slow as safety margin shrinks. Paychex's 4.3% dividend is safe but its payout buffer is shrinking, so future increases will…
- Keywords: paychex, dividend, safety margin, cash flow, nasdaq, paycor, adp, paycom, Growth, Slowing, 24/7 Wall St.
- Source: 24/7 Wall St. — https://247wallst.com/investing/2026/10/20/paychexs-4-3-dividend-looks-attractive-but-its-safety-margin-is-shrinking
- Author: Chris Lange
- Published: 2026-10-20T13:45:02+00:00
- Read time: 1 min
- Topics: paychex, dividend, safety margin, cash flow, nasdaq, paycor, adp, paycom
## Dividend History
Paychex has raised its dividend every year since 2020 with a 10% increase to $1.19 per share.
## Current Dividend Yield
The stock's forward yield is 4.3% with shares at $111.20 and a $4.76 annual payout.
## Cash Flow Coverage
Dividends use 68% of free cash flow, 90% of net income, and 86% of fiscal 2026 EPS.
## Paycor Debt Pressure
Paychex took on $5 billion in borrowings for Paycor with $4.6 billion in debt against $1 billion in cash.
## Competitor Comparison
ADP pays 50% of free cash flow in dividends with room for buybacks, while Paycom relies on buybacks.
## Future Dividend Outlook
Fiscal 2027 guidance assumes flat employment levels with no signs of recession.
## Key takeaway

Paychex's 4.3% dividend is safe but its payout buffer is shrinking, so future increases will likely match earnings growth rather than exceed it.