Paycom Software (PAYC) Stock Drops Despite Market Gains: Important Facts to Note
Paycom Software (PAYC) closed at $205.69 in the latest trading session, marking a -0.31% move from the prior day. The stock's performance was behind the S&P 500's daily gain of 0.14%. On the other hand, the Dow registered a gain of 0.3%, and the technology-centric Nasdaq increased by 0.16%.
The maker of human-resources and payroll software's shares have seen an increase of 15.74% over the last month, surpassing the Computer and Technology sector's gain of 4.87% and the S&P 500's gain of 4.89%.
The upcoming earnings release of Paycom Software will be of great interest to investors. The company is predicted to post an EPS of $1.78, indicating a 2.89% growth compared to the equivalent quarter last year. In the meantime, our current consensus estimate forecasts the revenue to be $422.54 million, indicating a 14.01% growth compared to the corresponding quarter of the prior year.
PAYC's full-year Zacks Consensus Estimates are calling for earnings of $7.63 per share and revenue of $1.68 billion. These results would represent year-over-year changes of +24.27% and +22.28%, respectively.
Investors should also take note of any recent adjustments to analyst estimates for Paycom Software. These latest adjustments often mirror the shifting dynamics of short-term business patterns. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the past month, there's been a 0.08% rise in the Zacks Consensus EPS estimate. At present, Paycom Software boasts a Zacks Rank of #3 (Hold).
In the context of valuation, Paycom Software is at present trading with a Forward P/E ratio of 27.04. This denotes a discount relative to the industry's average Forward P/E of 40.02.
Investors should also note that PAYC has a PEG ratio of 1.34 right now. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. As of the close of trade yesterday, the Internet - Software industry held an average PEG ratio of 1.81.
The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 37, putting it in the top 15% of all 250+ industries.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.
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Paycom Software, Inc. (PAYC) : Free Stock Analysis Report
