Paycom (PAYC)
NYSEIndustrialsSoftware - ApplicationSnapshot 2026-09-04
$231.67-3.68%
Close 2026-09-04 · 1-day change
NYSEIndustrialsSoftware - ApplicationSnapshot 2026-09-04
Intact: The reason to own it still holds.
Paycom grows revenue about 7% yearly, hitting $2.18 billion in 2026. Profit rises with operating income at $210 million in Q1 2026. The company pays steady dividends of $0.375 per share. It trades cheap with a PE of 15.9 versus peers at 27.
Legal issues could hurt Paycom's reputation and business. Growth may slow below 7%. Dividend payments might face pressure if profits weaken.
The price is about 8% below our fair value near $156. Analysts expect 8% revenue growth, close to our view.
Breaks if: Dividend per share falls below $0.35 in next 4 quarters
Breaks if: Operating income falls below $180 million in Q1 2026
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
This is a durable compounder with a focus on revenue growth and shareholder returns. The current thesis state is intact, supported by strong recent financial results and ongoing management priorities.
The market appears to have a neutral valuation stance, with a slight premium compared to peers. There is a low expectations gap, suggesting that current performance is largely aligned with what investors expect.
Management has consistently delivered on revenue growth, maintaining a steady dividend and executing share repurchases. While the near-term risk of missing earnings is low, there is a history of volatility in the sector that could impact performance.
The long-term thesis hinges on the performance of sector bellwethers like UBER, ADP, and GRAB. If these companies continue to perform well, it could provide a favorable environment for PAYC, while any misses could create headwinds.
The most important moves since the prior daily snapshot.
Yes, our read has strengthened. The company beat earnings and revenue estimates. Management raised full-year guidance for total revenue and adjusted EBITDA. This positive news supports expectations for higher revenue growth. However, the share price has recently fallen. It dropped 3.68% in the last day. There are risks around AI commoditization and a securities class action. These factors create some uncertainty about the stock's value.
as of 2026-09-04
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.
Improve operating income through revenue growth and disciplined cost management.
Stated in 4 of last 4 quarters. Operating income grew from $112.3 million in 2025-Q2 to $168.5 million in 2026-Q2, showing a significant improvement in profitability. Management is delivering enhanced operating income through revenue growth and cost discipline.
“Operating income was $168.5 million, compared to $112.3 million in the same period last year.”
“Operating income was $210.2 million, compared to $185.1 million in the same period last year.”
“Operating income was $157.2 million, compared to $148.5 million in the same period last year.”
“Operating income was $112.3 million, compared to $104.9 million in the same period last year.”
Breaks if: Revenue falls below $2.0 billion in FY 2026
Continue to grow total and recurring revenues with a focus on automation and client retention to expand market share.
Stated as a priority in 4 of last 4 quarters. Revenue grew from $483.6 million in 2025-Q2 to $531.2 million in 2026-Q2, a 9.8% increase year-over-year. Full year 2026 revenue guidance was raised to $2.197-$2.212 billion, representing 7%-8% growth. Management is delivering on revenue growth with consistent execution and raised outlook.
“Our strong second-quarter results came in ahead of expectations, reflecting the strength of our automation strategy and disciplined execution.”
“We delivered solid first-quarter results while executing our strategy to provide full-solution automation, stronger client ROI achievement and world-class service.”
“We delivered strong results in 2025, exceeding our strategic and financial goals for the year by driving full solution automation and strengthening client retention to 91%.”
“Focus on creating automation and employee-first technology is driving higher engagement and client satisfaction.”
Overall, PAYC's fundamentals are solid, but the company must navigate sector challenges and execution risks. Not investment advice.