
Paycom Software (PAYC) Stock Forecast & Price Target
Paycom Software (PAYC) Analyst Ratings
Bulls say
Paycom Software has demonstrated substantial growth, with its client count increasing from 12,800 in 2014 to over 37,500 in 2024, translating to a compound annual growth rate (CAGR) of 16%. The company has benefited from strong market demand in recent years, particularly in 2021 and 2022, through the acquisition of new clients and the successful cross-selling of additional service modules, alongside favorable interest rates. Additionally, while capital expenditures as a percentage of revenue have risen from 7% to 13% within a single quarter due to strategic investments in technological advancements, this increased spending is anticipated to support future growth initiatives.
Bears say
Paycom Software is projected to experience a decline in new annual recurring revenue (ARR) by 15%, despite an anticipated growth of 11% year-over-year in recurring and other revenue for the fourth quarter of fiscal 2025, amounting to approximately $516 million. The company's gross margin is expected to be slightly impacted due to depreciation from a significant investment in $130 million worth of GPUs, potentially falling below current consensus estimates. Furthermore, customer retention has deteriorated from 94% in 2021 to 90% in 2023, suggesting increased competitive pressures and addressing concerns over its growth trajectory.
This aggregate rating is based on analysts' research of Paycom Software and is not a guaranteed prediction by Public.com or investment advice.
Paycom Software (PAYC) Analyst Forecast & Price Prediction
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