We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Paycom (PAYC) to Report Q4 Earnings: What's in the Cards?
Read MoreHide Full Article
Paycom (PAYC - Free Report) is set to report fourth-quarter 2018 results on Feb 5.
The company’s earnings beat the Zacks Consensus Estimate in three of the trailing four reported quarters and matched it once, the average positive surprise being 13.02%.
In the last reported quarter, the company’s non-GAAP earnings per share came in at 52 cents per share, which met the Zacks Consensus Estimate and soared 79.3% from the year-ago quarter.
Moreover, revenues of $133.3 million surged 31.6% from the year-ago quarter and also surpassed the Zacks Consensus Estimate of $130.5 million.
What to Expect in Q4
For fourth-quarter 2018, Paycom expects revenues in the range of $142.5-$144.5 million. The Zacks Consensus Estimate is pegged at $143.9 million, indicating a 26.2% increase from the year-earlier quarter.
The Zacks Consensus Estimate for earnings stands at 56 cents per share, reflecting a rise of 93% on a year-over-year basis.
Let’s see how things are shaping up for the upcoming announcement.
Factors at Play
Paycom consistently gains from a robust adoption of advanced human capital management (HCM) solutions across industries and geographies. New business wins and improvement in sales productivity are tailwinds for the company.
Notably, the company is gaining a foothold among larger companies. As a result, it expanded its proactive sales effort to target companies with 50-5000 employees as compared to the earlier aim of 50-2000 employees. The company’s solutions can therefore compete in larger accounts more effectively, thereby boosting its top-line growth.
However, intensifying competition from companies like Automatic Data Processing (ADP - Free Report) , Paylocity Holding (PCTY - Free Report) , Intuit (INTU - Free Report) and Paychex remains a headwind, which could induce pricing pressure and affect Paycom’s margins. Notably, improvement in ADP’s retention rate and a transition of all its mid-market customers to internal SaaS solutions is a major threat to Paycom, which lured away customers from the former.
Additionally, higher sales and marketing expense in the fourth quarter due to the company’s national advertising campaign are likely to keep margins stressed.
In addition to the stocks discussed above, wouldn't you like to know about our 10 finest buy-and-holds for the year?
From more than 4,000 companies covered by the Zacks Rank, these 10 were picked by a process that consistently beats the market. Even during 2018 while the market dropped -5.2%, our Top 10s were up well into double-digits. And during bullish 2012 – 2017, they soared far above the market's +126.3%, reaching +181.9%.
This year, the portfolio features a player that thrives on volatility, an AI comer, and a dynamic tech company that helps doctors deliver better patient outcomes at lower costs.
Image: Bigstock
Paycom (PAYC) to Report Q4 Earnings: What's in the Cards?
Paycom (PAYC - Free Report) is set to report fourth-quarter 2018 results on Feb 5.
The company’s earnings beat the Zacks Consensus Estimate in three of the trailing four reported quarters and matched it once, the average positive surprise being 13.02%.
In the last reported quarter, the company’s non-GAAP earnings per share came in at 52 cents per share, which met the Zacks Consensus Estimate and soared 79.3% from the year-ago quarter.
Moreover, revenues of $133.3 million surged 31.6% from the year-ago quarter and also surpassed the Zacks Consensus Estimate of $130.5 million.
What to Expect in Q4
For fourth-quarter 2018, Paycom expects revenues in the range of $142.5-$144.5 million. The Zacks Consensus Estimate is pegged at $143.9 million, indicating a 26.2% increase from the year-earlier quarter.
The Zacks Consensus Estimate for earnings stands at 56 cents per share, reflecting a rise of 93% on a year-over-year basis.
Let’s see how things are shaping up for the upcoming announcement.
Factors at Play
Paycom consistently gains from a robust adoption of advanced human capital management (HCM) solutions across industries and geographies. New business wins and improvement in sales productivity are tailwinds for the company.
Notably, the company is gaining a foothold among larger companies. As a result, it expanded its proactive sales effort to target companies with 50-5000 employees as compared to the earlier aim of 50-2000 employees. The company’s solutions can therefore compete in larger accounts more effectively, thereby boosting its top-line growth.
However, intensifying competition from companies like Automatic Data Processing (ADP - Free Report) , Paylocity Holding (PCTY - Free Report) , Intuit (INTU - Free Report) and Paychex remains a headwind, which could induce pricing pressure and affect Paycom’s margins. Notably, improvement in ADP’s retention rate and a transition of all its mid-market customers to internal SaaS solutions is a major threat to Paycom, which lured away customers from the former.
Additionally, higher sales and marketing expense in the fourth quarter due to the company’s national advertising campaign are likely to keep margins stressed.
Paycom currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Paycom Software, Inc. Price and EPS Surprise
Paycom Software, Inc. Price and EPS Surprise | Paycom Software, Inc. Quote
Zacks' Top 10 Stocks for 2019
In addition to the stocks discussed above, wouldn't you like to know about our 10 finest buy-and-holds for the year?
From more than 4,000 companies covered by the Zacks Rank, these 10 were picked by a process that consistently beats the market. Even during 2018 while the market dropped -5.2%, our Top 10s were up well into double-digits. And during bullish 2012 – 2017, they soared far above the market's +126.3%, reaching +181.9%.
This year, the portfolio features a player that thrives on volatility, an AI comer, and a dynamic tech company that helps doctors deliver better patient outcomes at lower costs.
See Stocks Today >>