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Paycom Performs Way Ahead Of Expectations

Jan. 26, 2023 10:37 AM ETPaycom Software, Inc. (PAYC)


  • Paycom bucked an increasingly established trend that we've seen across tech companies in the last two quarters, which is unabated growth.
  • While it's a competitive market, the argument behind Paycom is that it's still a very small part of it, and there's still a lot of inefficiency in payroll tech solutions.
  • The claim holds water, and the results reflect that too. Guidance points to continued performance and operating leverage all coming from predictable organic growth efforts.
  • Reasonably, we can expect earnings to double without running into much trouble, although it will take as long as it takes for marketing methods to produce leads.
  • That would bring forward multiple down a lot, but more growth would be required to make the current multiple reasonable, and that would be harder to bet on.
  • Looking for a helping hand in the market? Members of The Value Lab get exclusive ideas and guidance to navigate any climate. Learn More »
Closeup shot of an unrecognisable businesswoman using a calculator and laptop in an office

LumiNola/E+ via Getty Images

Paycom Software (NYSE:PAYC) is a company that provides a payroll management solution to companies. The key proposition is that their system engages the employee to fill out their payroll data and make sure their checks are right - and there's a lot

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This article was written by

The Valkyrie Trading Society is a team of analysts sharing high conviction and obscure developed market ideas that are likely to generate non-correlated and outsized returns in the context of the current economic environment and forces. They are long-only investors.

They lead the investing group The Value Lab where they offer members a portfolio with real time updates, chat to answer questions 24/7, regular global market news reports, feedback on member stock ideas, new trades monthly, quarterly earnings write-ups, and daily macro opinions.

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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