|Bid||268.05 x 800|
|Ask||274.63 x 1800|
|Day's Range||266.15 - 270.84|
|52 Week Range||111.48 - 279.95|
|Beta (3Y Monthly)||1.29|
|PE Ratio (TTM)||94.18|
|Earnings Date||Feb 3, 2020 - Feb 7, 2020|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||241.35|
Software and its close cousin, services, are en vogue once more.For some time, Apple (AAPL), Samsung and other tech stocks sucked up most of the air in the room with their smartphone rivalries and hardware "reveals." But over the past few years, the momentum has clearly swung back toward companies offering software and services.Software isn't new, but how it's being delivered and monetized is. Tech stocks are increasingly borrowing a concept from the services model: subscriptions. Consumers like the lower cost of entry compared to paying big upfront for a software package. Enterprise customers have bought in too. And investors love the resulting financial benefit."Manufacturers benefit from the subscription model," says John Conlon, Chief Equity Strategist, People's United Advisors. "It provides them with a very steady stream of revenue. It's a lot easier to get a handle on what a company's revenue stream will be using a subscription model. It lowers the entry point for potential customers, which encourages more customers to pay for the service offered. It's an easier business model."Here, we examine 11 tech stocks to buy that have the potential to deliver super-sized software profits. SEE ALSO: 43 Companies Amazon Could Destroy (Including One for a Second Time)
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Paycom Software, Inc. (“Paycom”) (PAYC), a leading provider of comprehensive, cloud-based human capital management (HCM) software, announced the availability of a downloadable Workplace Threat Assessment and Response Guide, giving employers a framework to assess and potentially preempt workplace violence incidents. Paycom developed the guide in early 2018 based on insights gained after the company disrupted a potential workplace violence incident at its headquarters over a year ago; today, more than 100 Fortune 1000 companies are utilizing the publication. In summer 2018, Paycom formed a coalition composed of businesses, mental health professionals, nonprofits and leaders in law enforcement.
Like everyone else, elite investors make mistakes. Some of their top consensus picks, such as Amazon, Facebook and Alibaba, have not done well in Q4 of 2018 due to various reasons. Nevertheless, the data show elite investors' consensus picks have done well on average over the long-term. The top 20 stocks among hedge funds beat […]
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Paycom Software, Inc. , a leading provider of comprehensive, cloud-based human capital management software, today announced that the company will participate in the foll
Today we'll look at Paycom Software, Inc. (NYSE:PAYC) and reflect on its potential as an investment. In particular...
Paycom (PAYC) delivered earnings and revenue surprises of 1.45% and 2.03%, respectively, for the quarter ended September 2019. Do the numbers hold clues to what lies ahead for the stock?
Paycom reported Q3 profit and revenue that topped consensus estimates. The Paycom earnings beat and guidance, though, lacked the oomph investors looked for amid a high stock valuation.
There are several ways to beat the market, and investing in small cap stocks has historically been one of them. We like to improve the odds of beating the market further by examining what famous hedge fund operators such as Jeff Ubben, George Soros and Carl Icahn think. Those hedge fund operators make billions of […]
To many investors, the idea that Splunk (NASDAQ:SPLK) stock is cheap seems ludicrous. Splunk's guidance calls for negative operating cash flow this year. And Splunk stock trades at roughly eight times its sales (excluding its net cash) and 50 times analysts' average 2020 earnings per share estimate.Source: Michael Vi / Shutterstock.com Splunk stock hardly seems like a value play. But it does look at least inexpensive compared with its peers. Its price-sales ratio is one of the lowest of any company whose revenues are growing at a 30%+ clip.In recent quarters, Workday (NASDAQ:WDAY) and Paycom Software (NYSE:PAYC) posted similar revenue increases as SPLK. WDAY trades at over 11 times its revenue, and PAYC's price-sales ratio is 17. Other software companies are growing at rates similar to SPLK and have higher valuations.InvestorPlace - Stock Market News, Stock Advice & Trading TipsBut why is SPLK stock trading at a discount to some of its peers and why has that situation persisted? SPLK stock has gained roughly 20% over the past year, but that figure is skewed by timing. Splunk stock actually sits below where it was after its fiscal Q2 results which were released back in August 2018.There are interesting arguments for why the relatively low valuation of Splunk stock has created a buying opportunity. There are also interesting arguments as to why SPLK stock deserves the discount. Overall, I'd lean towards the bullish argument. But investors who are considering buying Splunk stock need to consider multiple points. * 7 Dividend Stocks to Buy (With Brands You Can Find In Your Kitchen) The Case for Splunk StockSplunk stock is not necessarily cheap. Its valuation is still higher than that of the average stock, and for good reason.Splunk's log-management offerings are a direct play on Big Data. And the company's growth has been impressive. Its revenue increased 41% in fiscal 2017 and jumped 38%+ in the following two years. Its sales are expected to increase roughly 28% in FY20.Meanwhile, as noted earlier, SPLK stock has stalled out, trading sideways for the last 13+ months. That performance, combined with the company's revenue and profit growth, has caused the multiples of Splunk stock to fall. And bulls would argue that some of the relative weakness has come from a misunderstanding surrounding the company's cash flow guidance.After all, Splunk stock fell after its Q2 results partly because of its cash flow guidance. Splunk's guidance went from $250 million to -$300 million, a seemingly huge change. But bulls would argue that the shift was caused by the company's transition to a subscription model. That transition creates uneven sales growth, meaning the guidance change indicates little, if any, alteration of Splunk's long-term cash flow.That guidance overshadowed a strong report, as SPLK's software revenue jumped 46% year-over-year. The bull case is that the company's growth outlook remains intact, while short-term concerns have moved SPLK stock to a lower and more attractive valuation.Wall Street analysts seem to agree; their average price target on SPLK stock is about 25% above its current price. Last month, Raymond James said the company's new pricing model could boost Splunk stock in the near-term. The Case Against SPLK StockThe bull case on SPLK is intriguing, and I wouldn't be surprised to see SPLK stock break out at some point. But the shares pose some risks as well.For one, SPLK might well be cheap on a relative basis, but that doesn't guarantee that the shares will rise. Eight times revenue, even with Splunk's attractive gross margins, still prices in quite a bit of growth. Moreover, Splunk stock lost about a third of its value during last year's Q4 stock-market selloff. If the stock market tumbles again, SPLK stock will fall further.The other considerable risk is on the competitive front. Splunk is the leader in log management, but it has some tough competitors. Elastic (NYSE:ESTC), for example, offers an open-source ELK Stack which allows customers to build their own log management systems, as opposed to buying them from Splunk.Datadog (NASDAQ:DDOG), which recently launched its IPO, is another competitor. Datadog offers a unified platform that includes log management, but also infrastructure, cloud, and application-performance monitoring. DDOG is trading at roughly 20 times its revenue, suggesting that investors are bullish on its outlook.Both Datadog and Elastic have posted stronger revenue growth than Splunk of late, although both are doing so from lower revenue bases than SPLK. Hope for a Better Entry Point?For software-as-a-service (SaaS) investors, then, SPLK probably is at the top of the list. Its valuation might be questionable, but it is quite attractive relative to what investors have been willing to pay for growth stocks in recent years.But I'm not sure Splunk stock quite gets to the point of being compelling for those investors who aren't focused on growth stocks.SPLK is facing risks. The shares probably can grow into their forward price-earnings multiple of 40+. But it only takes one earnings miss for competitive risks to move to the forefront of investors' minds.Given the performance of Splunk stock over the past 12+ months, it does seem worth staying on the sidelines and hoping for a better entry point. SPLK probably is cheap, but it's a little too cheap. And there are reasons why it could get even cheaper.As of this writing, Vince Martin has no positions in any securities mentioned. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Dividend Stocks to Buy (With Brands You Can Find In Your Kitchen) * 7 Hot & Trendy Generation Z Stocks to Buy * 5 Stocks to Buy in the Mighty Middle The post Splunk Stock Actually Is Cheap, But Why Is That? appeared first on InvestorPlace.