Paycom Software (NYSE: PAYC) has seen its price target reduced by Jefferies Financial Group from $250.00 to $225.00. This adjustment comes in a report published on October 8, 2023, indicating a hold rating on the company’s stock. This revision is part of a broader assessment by various financial analysts, reflecting mixed opinions on the software maker’s future performance.
Analyst Perspectives on Paycom Software
On September 26, 2023, Guggenheim initiated coverage of Paycom Software with a more optimistic outlook, assigning a “buy” rating and setting a target price of $270.00. In contrast, Weiss Ratings reaffirmed a “hold (c)” rating on October 8, 2023. Meanwhile, JPMorgan Chase & Co. raised its target price from $215.00 to $235.00, also maintaining a neutral stance. Additionally, BMO Capital Markets increased its price target from $244.00 to $258.00 and issued a “market perform” rating.
Overall, four investment analysts have rated Paycom Software with a buy rating, while eleven have opted for a hold rating. According to MarketBeat.com, the company currently holds an average rating of “hold” with a consensus price target of $245.62.
Stock Performance and Recent Financial Results
On October 8, 2023, Paycom’s stock opened at $201.49. The company boasts a market capitalization of $11.66 billion, a price-to-earnings (P/E) ratio of 27.27, and a price-to-earnings-growth (PEG) ratio of 2.19. Paycom’s 50-day moving average stands at $218.42, while the 200-day moving average is $228.90. Over the past year, its stock has fluctuated with a 52-week low of $161.24 and a high of $267.76.
The company’s quarterly earnings report, released on August 6, 2023, revealed earnings per share (EPS) of $2.06, surpassing the consensus estimate of $1.78 by $0.28. Paycom reported revenue of $483.60 million, exceeding expectations of $472.00 million. Additionally, the company achieved a return on equity of 25.40% and a net margin of 21.22%, marking a year-over-year revenue increase of 10.5%.
Dividend Announcement and Insider Activity
Paycom Software also announced a quarterly dividend recently, which was paid on September 8, 2023. Shareholders on record as of August 25, 2023 received a dividend of $0.375, leading to an annualized dividend of $1.50 and a yield of 0.7%. The company’s dividend payout ratio currently stands at 20.30%.
In a separate development, insider Bradley Scott Smith sold 1,500 shares of Paycom’s stock on September 12, 2023, at an average price of $223.27, totaling $334,905.00. Following this transaction, Smith retains 24,533 shares valued at approximately $5.48 million, reflecting a 5.76% reduction in his holdings. This transaction was reported to the Securities and Exchange Commission and is publicly available through their website.
Institutional Trading Trends
Recent changes in institutional holdings also highlight ongoing investment in Paycom Software. Brooklyn Investment Group increased its stake by 19.4% in the first quarter, now owning 240 shares valued at $52,000. Commerce Bank added 2.2% to its holdings, bringing its total to 2,351 shares worth $514,000. Other institutions, including Allworth Financial LP and US Bancorp DE, have similarly expanded their positions, with institutional investors collectively owning 87.77% of Paycom Software’s stock.
Paycom Software, Inc. delivers cloud-based human capital management solutions as software-as-a-service for small to mid-sized companies across the United States, providing essential functionality and data analytics for managing the employment life cycle from recruitment to retirement. The company continues to navigate a competitive landscape while adapting to the evolving needs of its clients.