NYSE:PAYC—A High-Growth Stock Gearing Up for Its Next Upward Move.

In this article, we'll take a closer look at PAYCOM SOFTWARE INC (NYSE:PAYC) as a potential candidate for growth investing. While it's important for investors to conduct their own research, PAYCOM SOFTWARE INC has piqued our interest by appearing on our strong growth and breakout radar. Let's explore further.

How do we evaluate the Growth for NYSE:PAYC?

A key component of ChartMill's stock assessment is the Growth Rating, which spans from 0 to 10. This rating evaluates diverse growth factors, such as EPS and revenue growth, considering both past performance and future projections. NYSE:PAYC has received a 8 out of 10:

• The Earnings Per Share has grown by an nice 17.71% over the past year.
• Measured over the past years, PAYC shows a very strong growth in Earnings Per Share. The EPS has been growing by 23.85% on average per year.
• Looking at the last year, PAYC shows a quite strong growth in Revenue. The Revenue has grown by 18.23% in the last year.
• PAYC shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 24.50% yearly.
• Based on estimates for the next years, PAYC will show a quite strong growth in Earnings Per Share. The EPS will grow by 10.42% on average per year.
• PAYC is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 11.75% yearly.

A Closer Look at Health for NYSE:PAYC

Every stock is evaluated by ChartMill, receiving a Health Rating on a scale of 0 to 10. This assessment considers different health aspects, including liquidity and solvency, both in absolute terms and relative to industry peers. NYSE:PAYC has achieved a 8 out of 10:

• An Altman-Z score of 3.27 indicates that PAYC is not in any danger for bankruptcy at the moment.
• PAYC has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
• PAYC does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.

Analyzing Profitability Metrics

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. NYSE:PAYC was assigned a score of 8 for profitability:

• With an excellent Return On Assets value of 9.90%, PAYC belongs to the best of the industry, outperforming 85.19% of the companies in the same industry.
• With an excellent Return On Equity value of 32.59%, PAYC belongs to the best of the industry, outperforming 86.42% of the companies in the same industry.
• PAYC has a Return On Invested Capital of 23.25%. This is amongst the best in the industry. PAYC outperforms 91.36% of its industry peers.
• Measured over the past 3 years, the Average Return On Invested Capital for PAYC is significantly above the industry average of 11.79%.
• The last Return On Invested Capital (23.25%) for PAYC is above the 3 year average (17.49%), which is a sign of increasing profitability.
• The Profit Margin of PAYC (26.90%) is better than 93.83% of its industry peers.
• The Operating Margin of PAYC (33.11%) is better than 96.30% of its industry peers.
• The Gross Margin of PAYC (83.37%) is better than 93.83% of its industry peers.

How do we evaluate the setup for NYSE:PAYC?

In addition to the Technical Rating, ChartMill provides a Setup Rating for each stock. This rating, ranging from 0 to 10, assesses the extent of consolidation in the stock based on multiple short-term technical indicators. Currently, NYSE:PAYC has a 8 as its setup rating:

PAYC has a bad technical rating, but it does show a decent setup pattern. Prices have been consolidating lately and the volatility has been reduced. There is very little resistance above the current price. There is a support zone below the current price at 179.54, a Stop Loss order could be placed below this zone. We notice that large players showed an interest for PAYC in the last couple of days, which is a good sign.

Our Strong Growth screener lists more Strong Growth stocks and is updated daily.

Check the latest full fundamental report of PAYC for a complete fundamental analysis.

For an up to date full technical analysis you can check the technical report of PAYC

Keep in mind

This article should in no way be interpreted as advice. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.