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Paycom Software: A Wonderful Company With Unattractive Valuation

Aug. 29, 2023 5:04 PM ETPaycom Software, Inc. (PAYC)4 Comments
Dair Sansyzbayev profile picture
Dair Sansyzbayev


  • Paycom Software is a high-quality business with strong revenue growth and profitability metrics.
  • The company has a solid balance sheet, healthy cash position, and returns funds to shareholders through dividends and share buybacks.
  • Despite its positive outlook, the stock is currently overvalued and not attractively priced.

Paycom Center


Investment thesis

Paycom Software (NYSE:PAYC) is a high-quality business demonstrating best-in-class profitability across almost all key ratios. The company has a strong track record of revenue growth and is poised to remain at its impressive growth trajectory. The balance

This article was written by

Dair Sansyzbayev profile picture
I am a highly experienced Chief Financial Officer (CFO) with a strong background in the oilfield and real estate industries. With over a decade of experience in finance, I have led numerous complex due diligence efforts and M&A transactions, both domestically and internationally.In recent years, I have developed a keen interest in equity research and analysis of public companies. This interest has led me to render equity research services for a Dubai-based family office with over $20 million in assets under management (AUM). My expertise in finance allows me to provide valuable insights and recommendations to clients seeking to make informed investment decisions.I pride myself on my ability to analyze financial statements, evaluate market trends, and identify key drivers of growth in different industries. I am passionate about staying up-to-date on the latest developments and trends in the equity research industry, and I am always seeking to enhance my skills and knowledge through continuing education and professional development.

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.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (4)

dipoxx profile picture
thank you, Now it is better ?
The_Hammer profile picture
How would a slowing growth rate 10-12% impact fcf estimates? New rollout BETI seems to be less profitable with its self service employee offering. Probably less service expense and error adjustments. A bold move by management
The_Hammer profile picture
Well at $168.50 and dropping looks like covid lows are approaching. Any interest in the $150's?
I. M. Spartacus profile picture
Agreed. I'd be willing to dip a toe in at $200. Maybe the momo traders will bail out and I'll get my chance.
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