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What's in Store for Paycom (PAYC) This Earnings Season?
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Paycom Software (PAYC - Free Report) is set to report third-quarter fiscal 2020 results on Nov 4.
For the fiscal third quarter, management estimates revenues between $191 million and $193 million.
The Zacks Consensus Estimate for revenues is pegged at $192 million, indicating an increase of 9.7%, year over year. The consensus mark for earnings is 56 cents per share, suggesting a 20% fall from the prior-year quarter.
The company’s earnings beat the Zacks Consensus Estimate in all of the trailing four quarters, the average beat being 5.5%.
Let’s see how things have shaped up for the upcoming announcement.
Factors at Play
Paycom’s quarterly performance is likely to have benefited from robust new business wins and the company’s high-margin recurring revenue business. The firm’s employee usage strategy, sales efforts and investments are anticipated to have boosted sales growth during the period in discussion.
The differentiated product offering of Direct Data Exchange for all Paycom clients is expected to have aided customer additions. Moreover, the launch of Ask Here is anticipated to have been conducive to its quarterly performance.
Further, Paycom’s growing foothold among larger companies makes us optimistic about its upcoming quarterly results.
Nonetheless, Paycom’s quarterly performance is likely to have been hurt by the unexpected rate cuts and spike in unemployment level due to the pandemic-trigger economic and business disruptions. Notably, some of the company’s businesses are directly related to the number of headcounts at its client offices.
We believe investors should be more focused on the company’s guidance rather than the quarterly results. They would want to hear from Paycom’s management regarding its plans to combat the coronavirus crisis and stay afloat during these turbulent times.
What Our Model Says
Our proven model predicts an earnings beat for Paycom this season. The combination of a positive Earnings ESP, and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), increases the chances of an earnings beat. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.
Paycom currently carries a Zacks Rank of 2 and has an Earnings ESP of +3.67%.
Other Stocks With Favorable Combinations
Here are some other companies, which, per our model, have the right combination of elements to post an earnings beat in their upcoming releases:
Hologic, Inc. (HOLX - Free Report) has an Earnings ESP of +20.90% and carries a Zacks Rank of 2, currently.
Marchex, Inc. (MCHX - Free Report) has an Earnings ESP of +16.67% and currently holds a Zacks Rank of 2.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early.
Image: Bigstock
What's in Store for Paycom (PAYC) This Earnings Season?
Paycom Software (PAYC - Free Report) is set to report third-quarter fiscal 2020 results on Nov 4.
For the fiscal third quarter, management estimates revenues between $191 million and $193 million.
The Zacks Consensus Estimate for revenues is pegged at $192 million, indicating an increase of 9.7%, year over year. The consensus mark for earnings is 56 cents per share, suggesting a 20% fall from the prior-year quarter.
The company’s earnings beat the Zacks Consensus Estimate in all of the trailing four quarters, the average beat being 5.5%.
Let’s see how things have shaped up for the upcoming announcement.
Factors at Play
Paycom’s quarterly performance is likely to have benefited from robust new business wins and the company’s high-margin recurring revenue business. The firm’s employee usage strategy, sales efforts and investments are anticipated to have boosted sales growth during the period in discussion.
Paycom Software, Inc. Price and Consensus
Paycom Software, Inc. price-consensus-chart | Paycom Software, Inc. Quote
The differentiated product offering of Direct Data Exchange for all Paycom clients is expected to have aided customer additions. Moreover, the launch of Ask Here is anticipated to have been conducive to its quarterly performance.
Further, Paycom’s growing foothold among larger companies makes us optimistic about its upcoming quarterly results.
Nonetheless, Paycom’s quarterly performance is likely to have been hurt by the unexpected rate cuts and spike in unemployment level due to the pandemic-trigger economic and business disruptions. Notably, some of the company’s businesses are directly related to the number of headcounts at its client offices.
We believe investors should be more focused on the company’s guidance rather than the quarterly results. They would want to hear from Paycom’s management regarding its plans to combat the coronavirus crisis and stay afloat during these turbulent times.
What Our Model Says
Our proven model predicts an earnings beat for Paycom this season. The combination of a positive Earnings ESP, and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold), increases the chances of an earnings beat. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.
Paycom currently carries a Zacks Rank of 2 and has an Earnings ESP of +3.67%.
Other Stocks With Favorable Combinations
Here are some other companies, which, per our model, have the right combination of elements to post an earnings beat in their upcoming releases:
Sunoco LP (SUN - Free Report) has an Earnings ESP of +1.00% and sports a Zacks Rank of 1, at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Hologic, Inc. (HOLX - Free Report) has an Earnings ESP of +20.90% and carries a Zacks Rank of 2, currently.
Marchex, Inc. (MCHX - Free Report) has an Earnings ESP of +16.67% and currently holds a Zacks Rank of 2.
The Hottest Tech Mega-Trend of All
Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>