(PAYC) Paycom Software - Overview
Sector: Technology | Industry: Software - Application | Exchange: NYSE (USA) | Market Cap: 6.425m USD | Total Return: -44.9% in 12m
Avg Turnover: 124M
EPS Trend: 97.2%
Qual. Beats: 1
Rev. Trend: 99.4%
Qual. Beats: 1
Warnings
No concerns identified
Tailwinds
Confidence, Garp
Paycom Software, Inc. (PAYC) provides a comprehensive, cloud-based Human Capital Management (HCM) platform delivered via a Software-as-a-Service (SaaS) model. Headquartered in Oklahoma City, the company targets small to mid-sized enterprises in the United States, offering a unified database to manage the entire employee lifecycle. Its core applications cover payroll processing, talent acquisition, time and labor management, and HR analytics.
The SaaS business model allows Paycom to generate recurring revenue through per-employee, per-pay-period fees, which provides high visibility into future cash flows. Within the Application Software sector, HCM providers are increasingly focused on employee self-service tools, such as Paycom’s Beti system, which shifts data entry and verification tasks to the employees to reduce administrative errors. This automation trend is a key driver for margin expansion in the payroll services industry.
For a deeper look into the companys valuation metrics, you may want to explore the data on ValueRay. The platform’s specialized tools, including the Manager on-the-Go and Clue for compliance tracking, reflect a broader industry shift toward mobile-first workforce management solutions.
- Beti automated payroll adoption cannibalizes traditional services revenue and impacts growth
- Elevated interest rates drive significant float income from client funds
- Small to mid-sized business employment levels dictate recurring subscription volume
- Competitive pricing pressure from HCM peers compresses adjusted EBITDA margins
- Regulatory changes in tax and labor laws drive demand for compliance software
| Net Income: 469.7m TTM > 0 and > 6% of Revenue |
| FCF/TA: 0.09 > 0.02 and ΔFCF/TA 0.76 > 1.0 |
| NWC/Revenue: 3.36% < 20% (prev 26.50%; Δ -23.14% < -1%) |
| CFO/TA 0.15 > 3% & CFO 707.0m > Net Income 469.7m |
| Net Debt (698.3m) to EBITDA (829.6m): 0.84 < 3 |
| Current Ratio: 1.02 > 1.5 & < 3 |
| Outstanding Shares: last quarter (51.2m) vs 12m ago -9.06% < -2% |
| Gross Margin: 79.74% > 18% (prev 0.82%; Δ 7.89k% > 0.5%) |
| Asset Turnover: 44.56% > 50% (prev 41.85%; Δ 2.71% > 0%) |
| Interest Coverage Ratio: 95.85 > 6 (EBITDA TTM 829.6m / Interest Expense TTM 6.70m) |
| A: 0.01 (Total Current Assets 2.91b - Total Current Liabilities 2.84b) / Total Assets 4.82b |
| B: 0.50 (Retained Earnings 2.39b / Total Assets 4.82b) |
| C: 0.14 (EBIT TTM 642.2m / Avg Total Assets 4.70b) |
| D: 0.60 (Book Value of Equity 2.39b / Total Liabilities 4.01b) |
| Altman-Z'' = 3.26 = A |
| DSRI: 2.10 (Receivables 71.9m/31.3m, Revenue 2.09b/1.91b) |
| GMI: 1.03 (GM 79.74% / 82.20%) |
| AQI: 1.17 (AQ_t 0.24 / AQ_t-1 0.21) |
| SGI: 1.09 (Revenue 2.09b / 1.91b) |
| TATA: -0.05 (NI 469.7m - CFO 707.0m) / TA 4.82b) |
| Beneish M = -1.98 (Cap -4..+1) = B |
As of May 30, 2026, the stock is trading at USD 139.67 with a total of 645,790 shares traded.
Over the past week, the price has changed by +4.25%,
over one month by +9.49%,
over three months by +11.62% and
over the past year by -44.85%.
Paycom Software has received a consensus analysts rating of 3.25. Therefore, it is recommended to hold PAYC.
- StrongBuy: 3
- Buy: 0
- Hold: 16
- Sell: 1
- StrongSell: 0
| Analysts Target Price | 151.4 | 8.4% |
P/E Trailing = 15.9491
P/E Forward = 13.3333
P/S = 3.0697
P/B = 7.9158
P/EG = 1.2182
Revenue TTM = 2.09b USD
EBIT TTM = 642.2m USD
EBITDA TTM = 829.6m USD
Long Term Debt = 675.0m USD (from longTermDebt, last quarter)
Short Term Debt = 28.6m USD (from shortTermDebt, last quarter)
Debt = 852.2m USD (from shortLongTermDebtTotal, last quarter) + Leases 88.6m
Net Debt = 698.3m USD (calculated: Debt 852.2m - CCE 153.9m)
Enterprise Value = 7.12b USD (6.43b + Debt 852.2m - CCE 153.9m)
Interest Coverage Ratio = 95.85 (Ebit TTM 642.2m / Interest Expense TTM 6.70m)
EV/FCF = 16.09x (Enterprise Value 7.12b / FCF TTM 442.6m)
FCF Yield = 6.21% (FCF TTM 442.6m / Enterprise Value 7.12b)
FCF Margin = 21.15% (FCF TTM 442.6m / Revenue TTM 2.09b)
Net Margin = 22.44% (Net Income TTM 469.7m / Revenue TTM 2.09b)
Gross Margin = 79.74% ((Revenue TTM 2.09b - Cost of Revenue TTM 424.1m) / Revenue TTM)
Gross Margin QoQ = 80.07% (prev 79.13%)
Tobins Q-Ratio = 1.48 (Enterprise Value 7.12b / Total Assets 4.82b)
Interest Expense / Debt = 0.79% (Interest Expense 6.70m / Debt 852.2m)
Taxrate = 27.64% (59.5m / 215.3m)
NOPAT = 464.7m (EBIT 642.2m * (1 - 27.64%))
Current Ratio = 1.02 (Total Current Assets 2.91b / Total Current Liabilities 2.84b)
Debt / Equity = 1.05 (Debt 852.2m / totalStockholderEquity, last quarter 811.7m)
Debt / EBITDA = 0.84 (Net Debt 698.3m / EBITDA 829.6m)
Debt / FCF = 1.58 (Net Debt 698.3m / FCF TTM 442.6m)
Total Stockholder Equity = 1.51b (last 4 quarters mean from totalStockholderEquity)
RoA = 10.00% (Net Income 469.7m / Total Assets 4.82b)
RoE = 31.03% (Net Income TTM 469.7m / Total Stockholder Equity 1.51b)
RoCE = 29.34% (EBIT 642.2m / Capital Employed (Equity 1.51b + L.T.Debt 675.0m))
RoIC = 23.87% (NOPAT 464.7m / Invested Capital 1.95b)
WACC = 7.94% (E(6.43b)/V(7.28b) * Re(8.92%) + D(852.2m)/V(7.28b) * Rd(0.79%) * (1-Tc(0.28)))
Discount Rate = 8.92% (= CAPM, Blume Beta Adj.)
Shares (quarterly) Correlation: -53.94 | Cagr: -4.83%
[DCF] Terminal Value 77.97% ; FCFF base≈419.5m ; Y1≈480.9m ; Y5≈707.6m
[DCF] Fair Price = 213.4 (EV 10.6b - Net Debt 698.3m = Equity 9.95b / Shares 46.6m; r=8.35% [WACC [floored]]; 5y FCF grow 14.99% → 2.50% )
EPS Correlation: 97.17 | EPS CAGR: 10.36% | SUE: 1.33 | # QB: 1
Revenue Correlation: 99.39 | Revenue CAGR: 10.80% | SUE: 1.47 | # QB: 1
EPS current Quarter (2026-06-30): EPS=2.37 | Chg30d=+3.28% | Revisions=+64% | Analysts=18
EPS next Quarter (2026-09-30): EPS=2.38 | Chg30d=+4.28% | Revisions=+55% | Analysts=18
EPS current Year (2026-12-31): EPS=10.92 | Chg30d=+4.08% | Revisions=+57% | GrowthEPS=+18.2% | GrowthRev=+6.7%
EPS next Year (2027-12-31): EPS=12.30 | Chg30d=+5.58% | Revisions=+82% | GrowthEPS=+12.6% | GrowthRev=+7.1%
[Analyst] Revisions Ratio: +82%