With a one year PEG ratio of 596.64, Paycom Software Inc is expected to have a higher PEG ratio (a measure of how expensive a stock is relative to its expected earnings growth) than 93.66% of US stocks.
Price to trailing twelve month operating cash flow for PAYC is currently 83.08, higher than 95.96% of US stocks with positive operating cash flow.
PAYC's price/sales ratio is 21.91; that's higher than the P/S ratio of 92.92% of US stocks.
If you're looking for stocks that are quantitatively similar to Paycom Software Inc, a group of peers worth examining would be OMCL, SPSC, ECOR, VCYT, and REFR.
Paycom Software offers cloud-based human capital management software solutions delivered as Softwareas-a-Service in the United States. It provides functionality and data analytics that businesses need to manage the complete employment life-cycle from recruitment to retirement. The company was founded in 1998 and is based in Oklahoma City, Oklahoma.
PAYC Price Forecast Based on DCF Valuation
DCF Fair Value Target:
Below please find a table outlining a discounted cash flow forecast for PAYC, in which we model out valuation assuming a variety of terminal growth rates. To summarize, we found that Paycom Software Inc ranked in the 30th percentile in terms of potential gain offered. We should note, though, that the most conservative analysis suggests this stock will yield negative results -- and thus may be a potential short opportunity. The most interesting components of our discounted cash flow analysis for Paycom Software Inc ended up being:
Interest coverage, a measure of earnings relative to interest payments, is 534.32 -- which is good for besting 98.27% of its peer stocks (US stocks in the Technology sector with positive cash flow).
The business' balance sheet reveals debt to be 0% of the company's capital (with equity being the remaining amount). Approximately just 2.54% of US stocks with free cash flow have a lower reliance on debt in their capital structure.
PAYC's estimated cost of debt, based largely on its market capitalization and its interest coverage ratio, is 2%; for context, that number is higher than 60.23% of tickers in our DCF set.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Technology that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as PAYC, try MIME, TEL, ASML, DOX, and INFY.
With its next quarterly earnings report due around Aug. 4, Paycom Software is currently approximately 11% shy of a 336.96 entry. The chart pattern is a first-stage consolidation. Buying a stock just ahead of earnings involves risk since you typically don't have enough time to establish a profit cushion before the latest quarterly numbers come out.
Paycom (PAYC) has been a great success story. With its compelling portfolio of products in the ever-growing HR SaaS space, the company has rewarded shareholders generously. Since its IPO, the stock has returned a cumulative return of around 1890% in just about six years. Many investors came to know Paycom...
Nikolaos Sismanis on Seeking Alpha | July 16, 2020
Paycom Software, Inc. ("Paycom") (NYSE:PAYC), a leading provider of comprehensive, cloud-based human capital management software, will release its results for the second quarter ended June 30, 2020, after the market closes on Tuesday, August 4. Paycom will also hold a conference call to discuss results at 5:00 p.m. (Eastern time) that day.