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Paycom (PAYC) to Report Q1 Earnings: What's in the Cards?
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Paycom Software (PAYC - Free Report) is set to report first-quarter 2021 results on May 4.
For the first quarter, management estimates revenues between $270 million and $272 million.
The Zacks Consensus Estimate for revenues is pegged at $271.42 million, indicating an increase of 11.99% year over year. The consensus mark for earnings is $1.42 per share, suggesting a 6.77% rise from the prior-year quarter’s reported figure.
The company’s earnings beat the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 9.4%.
Let’s see how things have shaped up for the upcoming announcement.
Paycom’s quarterly performance is likely to have benefited from new business wins. The firm’s employee usage strategy, sales efforts and investments are likely to have boosted sales growth during the period in discussion.
The company had earlier mentioned its intention to aggressively drive advertising and marketing efforts in order to generate more demo leads, virtual meetings and increased close rates of deals. This is likely to have led to further market share gains for Paycom.
Nonetheless, pandemic-triggered economic and business disruptions are likely to have trickled into Paycom’s first quarterly performance. Notably, some of the company’s businesses are directly related to the number of headcounts in its client offices.
Moreover, fewer forms are likely to have been filled in the quarter under review as compared to a typical first quarter due to reduced workforce in industries hardest hit by the pandemic, coupled with lower turnover in those industries. Management expects this impact to have resulted in a $6-$7-million headwind to recurring revenues during the first quarter.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for Paycom this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.
Paycom currently has a Zacks Rank of 3 and an Earnings ESP of 0.00%.
Stocks With Favorable Combinations
Here are some companies, which, per our model, have the right combination of elements to post an earnings beat in their upcoming releases:
CDW Corporation (CDW - Free Report) has an Earnings ESP of +0.51% and currently, a Zacks Rank of 2.
Twilio Inc. (TWLO - Free Report) has an Earnings ESP of +3.82% and a Zacks Rank of 3, currently.
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Paycom (PAYC) to Report Q1 Earnings: What's in the Cards?
Paycom Software (PAYC - Free Report) is set to report first-quarter 2021 results on May 4.
For the first quarter, management estimates revenues between $270 million and $272 million.
The Zacks Consensus Estimate for revenues is pegged at $271.42 million, indicating an increase of 11.99% year over year. The consensus mark for earnings is $1.42 per share, suggesting a 6.77% rise from the prior-year quarter’s reported figure.
The company’s earnings beat the Zacks Consensus Estimate in the trailing four quarters, the average surprise being 9.4%.
Let’s see how things have shaped up for the upcoming announcement.
Paycom Software, Inc. Price and EPS Surprise
Paycom Software, Inc. price-eps-surprise | Paycom Software, Inc. Quote
Key Factors
Paycom’s quarterly performance is likely to have benefited from new business wins. The firm’s employee usage strategy, sales efforts and investments are likely to have boosted sales growth during the period in discussion.
The company had earlier mentioned its intention to aggressively drive advertising and marketing efforts in order to generate more demo leads, virtual meetings and increased close rates of deals. This is likely to have led to further market share gains for Paycom.
Nonetheless, pandemic-triggered economic and business disruptions are likely to have trickled into Paycom’s first quarterly performance. Notably, some of the company’s businesses are directly related to the number of headcounts in its client offices.
Moreover, fewer forms are likely to have been filled in the quarter under review as compared to a typical first quarter due to reduced workforce in industries hardest hit by the pandemic, coupled with lower turnover in those industries. Management expects this impact to have resulted in a $6-$7-million headwind to recurring revenues during the first quarter.
What Our Model Says
Our proven model does not conclusively predict an earnings beat for Paycom this season. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell, before they’re reported, with our Earnings ESP Filter.
Paycom currently has a Zacks Rank of 3 and an Earnings ESP of 0.00%.
Stocks With Favorable Combinations
Here are some companies, which, per our model, have the right combination of elements to post an earnings beat in their upcoming releases:
Vishay Intertechnology, Inc. (VSH - Free Report) has an Earnings ESP of +5.22% and a Zacks Rank of 2, at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
CDW Corporation (CDW - Free Report) has an Earnings ESP of +0.51% and currently, a Zacks Rank of 2.
Twilio Inc. (TWLO - Free Report) has an Earnings ESP of +3.82% and a Zacks Rank of 3, currently.
Breakout Biotech Stocks with Triple-Digit Profit Potential
The biotech sector is projected to surge beyond $775 billion by 2024 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases.
Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Our recent biotech recommendations have produced gains of +50%, +83% and +164% in as little as 2 months. The stocks in this report could perform even better.
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