HR Software Stocks Q4 In Review: Paylocity (NASDAQ:PCTY) Vs Peers
Quarterly earnings results are a good time to check in on a company’s progress, especially compared to other peers in the same sector. Today we are looking at Paylocity (NASDAQ:PCTY), and the best and worst performers in the HR software group.
Modern HR software has two powerful benefits: cost savings and ease of use. For cost savings, businesses large and small much prefer the flexibility of cloud-based, web-browser-delivered software paid for on a subscription basis rather than the hassle and complexity of purchasing and managing on-premise enterprise software. On the usability side, the consumerization of business software creates seamless experiences whereby multiple standalone processes like payroll processing and compliance are aggregated into a single, easy-to-use platform.
The 6 HR software stocks we track reported a weak Q4; on average, revenues beat analyst consensus estimates by 0.9% while next quarter's revenue guidance was 1.5% below consensus. Investors abandoned cash-burning companies to buy stocks with higher margins of safety, and while some of the HR software stocks have fared somewhat better than others, they have not been spared, with share prices declining 7.4% on average since the previous earnings results.
Weakest Q4: Paylocity (NASDAQ:PCTY)
Founded by payroll software veteran Steve Sarowitz in 1997, Paylocity (NASDAQ:PCTY) is a provider of payroll and HR software for small and medium-sized enterprises.
Paylocity reported revenues of $326.4 million, up 19.5% year on year, in line with analyst expectations. It was a weak quarter for the company, with underwhelming revenue guidance for the next quarter and full year.
“Our differentiated value proposition of providing the most modern software in the industry continues to resonate in the marketplace as we saw total revenue growth of 20% and recurring revenue growth of 16% in Q2 of fiscal 24. ” said Steve Beauchamp, Co-Chief Executive Officer of Paylocity.
Paylocity delivered the weakest full-year guidance update of the whole group. The stock is down 0.5% since the results and currently trades at $171.46.
Is now the time to buy Paylocity? Access our full analysis of the earnings results here, it's free.
Best Q4: Paycor (NASDAQ:PYCR)
Found in 1990 in Cincinnati, Ohio, Paycor (NASDAQ: PYCR) provides software for small businesses to manage their payroll and HR needs in one place.
Paycor reported revenues of $159.5 million, up 20.1% year on year, outperforming analyst expectations by 2.4%. It was a mixed quarter for the company, with a decent beat of analysts' billings estimates but underwhelming revenue guidance for the next quarter.
Paycor scored the fastest revenue growth among its peers. The stock is down 1.9% since the results and currently trades at $19.21.
Is now the time to buy Paycor? Access our full analysis of the earnings results here, it's free.
Paychex (NASDAQ:PAYX)
One of the oldest service providers in the industry, Paychex (NASDAQ:PAYX) offers its customers payroll and HR software solutions.
Paychex reported revenues of $1.26 billion, up 5.7% year on year, falling short of analyst expectations by 0.7%. It was a weak quarter for the company, with a miss of analysts' revenue estimates and a decline in its gross margin.
Paychex had the weakest performance against analyst estimates in the group. The stock is down 6.5% since the results and currently trades at $119.51.
Read our full analysis of Paychex's results here.
Dayforce (NYSE:DAY)
Founded in 1992 as Ceridian, an outsourced payroll processor and transformed after the 2012 acquisition of Dayforce, Dayforce (NYSE:DAY) is a provider of cloud based payroll and HR software targeted at mid-sized businesses.
Dayforce reported revenues of $399.7 million, up 18.9% year on year, in line with analyst expectations. It was a weak quarter for the company, with underwhelming revenue guidance for the next year.
The company added 47,000 customers to reach a total of 6.39 million. The stock is down 7.9% since the results and currently trades at $65.6.
Read our full, actionable report on Dayforce here, it's free.
Asure (NASDAQ:ASUR)
Created from the merger of two small workforce management companies in 2007, Asure (NASDAQ:ASUR) provides cloud based payroll and HR software for small and medium-sized businesses (SMBs).
Asure reported revenues of $26.26 million, down 10.3% year on year, falling short of analyst expectations by 0.2%. It was a slower quarter for the company, with underwhelming revenue guidance for the next year.
Asure achieved the highest full-year guidance raise but had the slowest revenue growth among its peers. The stock is down 23.2% since the results and currently trades at $7.86.
Read our full, actionable report on Asure here, it's free.
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