PAYC

Paycom Software, Inc.

Fundamental data last updated:October 6, 2026

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company profile

SECTOR

Technology

industry

Software - Application

Exchange

NYSE

County of HQ

US

Next Earnings Date

Pending Announcement

Business Summary

Paycom Software, Inc. provides cloud-based human capital management (HCM) solution delivered as software-as-a-service for small to mid-sized companies in the United States. It offers functionality and data analytics that businesses need to manage the employment life cycle from recruitment to retirement. The company's HCM solution provides a suite of applications in the areas of talent acquisition, including applicant tracking, candidate tracker, background checks, on-boarding, e-verify, and tax credit services; and time and labor management, such as time and attendance, scheduling/schedule exchange, time-off requests, labor allocation, labor management reports/push reporting, and geofencing/geotracking, and Microfence, a proprietary Bluetooth. Its HCM solution also offers payroll applications comprising better employee transaction interface, payroll and tax management, Paycom pay, expense management, mileage tracker/fixed and variable rates, garnishment management, and GL concierge applications; and talent management applications that include employee self-service, compensation budgeting, performance management, position management, and Paycom learning and content subscriptions, as well as my analytics, which offer employment predictor reporting. In addition, its HCM solution provides manager on-the-go that gives supervisors and managers the ability to perform a variety of tasks, such as approving time-off requests and expense reimbursements; direct data exchange; ask here, a tool for direct line of communication to ask work-related questions; document and checklist; government and compliance; benefits administration/benefits to carrier; COBRA administration; personnel action and performance discussion forms; surveys; and affordable care act applications, as well as Clue, which securely collect, track, and manage the vaccination and testing data of the workforce. Paycom Software, Inc. was founded in 1998 and is headquartered in Oklahoma City, Oklahoma.

 


VALUATION

P/E

15.20

Market Cap ($M USD)

$7.62B

Forward P/E

10.62

PEG

0.25

PRICE TO SALES

3.64

PRICE TO BOOK

8.79

EV / EBITDA

9.92

5-Year Average P/E

Free Cash Flow Yield

5.81%

DCF Value

$271.16

Graham Number

$57.32

Price to FCF

17.22

EV to FCF

18.60

Earnings Yield

6.58%

FCF Yield

5.81%

DIVIDEND

Yield

1.07%

Annual Payout

$1.50

Payout Ratio

17.33%

Consecutive Years of Dividend Growth

5-Year Dividend Growth Rate

Financial Health & Profitability

Earnings Per Share

$9.19

Next Year EPS Growth Estimate

$13.16

Next Year Revenue Growth Estimate

$2.53B

Return on Equity (ROE)

31.03%

FREE CASH FLOW

Operating Margin

28.30%

Debt-to-Equity

0.09

Piotroski F-Score

5

Altman Z-Score

2.70

Return on Invested Capital (ROIC)

29.88%

Current Ratio

1.02

Quick Ratio

1.02

Net Debt to EBITDA

0.73

Interest Coverage

88.42

Gross Profit margin

79.74%

FCF PER SHARE

$8.66

REVENUE PER SHARE

$40.96

Gainseekers Quantitative Analysis

Summary

The market seems to be significantly undervaluing Paycom Software, Inc. relative to its intrinsic worth. With a DCF value nearly double the snapshot price, there’s a glaring disconnect that savvy investors might exploit. The Forward P/E of 10.40 suggests a bargain for a company with robust growth prospects, while an Earnings Yield of 6.72% indicates a healthy return potential. Despite a moderate Altman Z-score of 2.70, which hints at some financial risk, the company’s overall financial health appears solid, especially given its impressive ROIC of 29.88%.

AI Exposure / Tech Reliance

Operating in the fast-paced Software - Application industry, Paycom is well-positioned to leverage AI advancements. Its technological backbone allows for seamless integration of AI-driven solutions, enhancing efficiency and customer experience. This adaptability ensures resilience amidst rapid tech shifts.

The Bull Case

For the discerning GARP investor, Paycom offers compelling reasons to buy. Its ROIC of 29.88% showcases exceptional capital efficiency, translating into strong shareholder returns. The FCF Yield, though modest, is supported by a robust operating margin of 28.30%, indicating solid cash generation capabilities. A Piotroski F-Score of 5 suggests moderate financial strength, while its pricing power is evident in a gross profit margin of nearly 80%.

The Bear Case

However, potential investors should be wary of its lofty Price/Book ratio of 8.62, which could signal overvaluation. The Price/Sales ratio of 3.57 also raises concerns about the stock's premium pricing. Technically, the stock's proximity to its 52-week high suggests it might be overextended. Despite a low Debt/Equity ratio, these valuation metrics could deter cautious investors.

Market Sentiment & Smart Money

Short Interest %

Analyst Consensus

Hold

Average Analyst Price Target

$151.75

Institutional Ownership %

1-Year Beta

0.78

Insider Buying % (6 Mo)

Distance to 52-Week High

91.71%

Distance to 52-Week Low

24.89%

EARNINGS SURPRISE %

5.35%

50-DAY SMA

$128.14

200-DAY SMA

$161.73

⚠️ Financial Disclaimer:
This content is for informational purposes only and is not financial advice. Information may be delayed or inaccurate. We may earn a commission from partner links.