Last Updated: 18 Sep 2024
Executive Summary
Paycom Software (PAYC) is a leading provider of online payroll and human resource technology. The company has a strong financial position with a market capitalization of $9.73 billion, EBITDA of $650.7 million, and EPS of $8.27. Paycom's stock price is currently trading at $169.04, below its 52-week high of $277.53. The company's fundamentals are strong, with a trailing PE ratio of 20.45 and a forward PE ratio of 18.73. Paycom's technical analysis indicates that the stock is in a downtrend, but the long-term outlook is positive.
Company Overview
Paycom Software, Inc. is an American online payroll and human resource technology provider based in Oklahoma City, Oklahoma. The company was founded in 1991 and has grown to become one of the leading providers of payroll and HR software in the United States. Paycom's software is used by over 28,000 customers, including small businesses, mid-sized businesses, and large enterprises.
Fundamental Analysis
Paycom's financial performance has been strong in recent years. The company's revenue has grown at a compound annual growth rate (CAGR) of 20% over the past five years. In 2023, Paycom reported revenue of $1.78 billion, up 20% from the previous year. The company's net income also grew by 20% in 2023, to $432.6 million.
Paycom's profitability metrics are also strong. The company's gross profit margin is 68%, and its operating margin is 22%. Paycom's profit margins are higher than the industry average, which indicates that the company is able to generate more profit from its sales than its competitors.
Paycom's balance sheet is also strong. The company has $1.2 billion in cash and equivalents, and its debt-to-equity ratio is 0.25. Paycom's strong balance sheet gives it the financial flexibility to invest in growth and to weather economic downturns.
Technical Analysis
Paycom's stock price has been in a downtrend since reaching a 52-week high of $277.53 in November 2023. The stock is currently trading below its 50-day and 200-day moving averages. The downtrend is likely due to a combination of factors, including the recent market sell-off and concerns about the company's growth prospects.
Short Term Outlook
The short-term outlook for Paycom's stock is mixed. The stock is currently trading below its 50-day and 200-day moving averages, which indicates that the downtrend is likely to continue in the near term. However, the company's fundamentals are strong, and the long-term outlook is positive.
Long Term Outlook
The long-term outlook for Paycom's stock is positive. The company is a leader in the growing market for online payroll and HR software. Paycom's strong financial position and its commitment to innovation will allow it to continue to grow its market share in the years to come.
Analyst Recommendations
Analysts are generally positive on Paycom's stock. The consensus analyst rating for the stock is "Buy." The average analyst target price for the stock is $183.04, which represents a potential upside of 8% from the current price.
