PAYC Q3 Earnings Analysis
Shares of Paycom posted their worst day on record after reporting their third quarter earnings and falling short of analyst expectations. The payroll and human resources company had already struggled to impress Wall Street since their last earnings, and their guidance miss this quarter didn’t sweeten their valuation at all. Analysts expected the company to post about a 20% revenue growth projection in 2024, but they fell short, projecting only 10-12% growth expectations. Even after the earnings decline, PAYC is still trading at a 42 P/E ratio, far above their largest competitor, ADP. ADP is bringing in nearly $20B in revenue a year and is trading at a 25 P/E ratio, where is PAYC is only bringing in approximately $9B a year. This obviously makes PAYC an expensive stock and indicates that it has more downside room to correct. The next downside target for the stock is around 100.00-115.00.