Why NASDAQ:PCTY Is a Standout High-Growth Stock in a Consolidation Phase.

Last update: Dec 6, 2023

Growth investors are on the lookout for stocks displaying robust revenue and EPS growth. In this analysis, we'll assess whether PAYLOCITY HOLDING CORP (NASDAQ:PCTY) aligns with growth investing criteria, especially as it consolidates and signals a possible breakout. As always, investors should conduct their own research, but PAYLOCITY HOLDING CORP has surfaced on our radar for growth with base formation, warranting further examination.

Assessing Growth for NASDAQ:PCTY

Every stock receives a Growth Rating from ChartMill, ranging from 0 to 10. This rating assesses various growth aspects, including historical and projected EPS and revenue growth. NASDAQ:PCTY boasts a 9 out of 10:

PCTY shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 53.30%, which is quite impressive.
Measured over the past years, PCTY shows a very strong growth in Earnings Per Share. The EPS has been growing by 32.16% on average per year.
PCTY shows a strong growth in Revenue. In the last year, the Revenue has grown by 34.06%.
PCTY shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 25.49% yearly.
The Earnings Per Share is expected to grow by 21.08% on average over the next years. This is a very strong growth
The Revenue is expected to grow by 15.69% on average over the next years. This is quite good.

Looking at the Health

ChartMill assigns a Health Rating to every stock. This score ranges from 0 to 10 and evaluates the different health aspects like liquidity and solvency, both absolutely, but also relative to the industry peers. NASDAQ:PCTY scores a 7 out of 10:

PCTY has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
PCTY 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.

Profitability Analysis for NASDAQ:PCTY

ChartMill's Profitability Rating offers a unique perspective on stock analysis, providing scores from 0 to 10. These ratings consider a wide range of profitability metrics and margins, both in comparison to industry peers and on their own merits. For NASDAQ:PCTY, the assigned 8 is a significant indicator of profitability:

PCTY's Return On Equity of 16.24% is fine compared to the rest of the industry. PCTY outperforms 73.42% of its industry peers.
PCTY has a better Return On Invested Capital (17.23%) than 81.01% of its industry peers.
The last Return On Invested Capital (17.23%) for PCTY is above the 3 year average (11.96%), which is a sign of increasing profitability.
PCTY's Profit Margin of 11.70% is amongst the best of the industry. PCTY outperforms 87.34% of its industry peers.
In the last couple of years the Profit Margin of PCTY has grown nicely.
PCTY has a Operating Margin of 15.27%. This is amongst the best in the industry. PCTY outperforms 83.54% of its industry peers.
PCTY's Operating Margin has improved in the last couple of years.
PCTY has a Gross Margin of 68.99%. This is amongst the best in the industry. PCTY outperforms 84.81% of its industry peers.
In the last couple of years the Gross Margin of PCTY has grown nicely.

How does the Setup look for NASDAQ:PCTY

Next to the Technical Rating, the Setup Rating of a stock determines to which extend the stock is consolidating. This score also ranges from 0 to 10 and is updated daily. The setup score evaluates various short term technical indicators. For NASDAQ:PCTY this score is currently 7:

PCTY has a bad technical rating, but it does show a decent setup pattern. Prices have been consolidating lately. There is a resistance zone just above the current price starting at 159.89. Right above this resistance zone may be a good entry point.

More Strong Growth stocks can be found in our Strong Growth screener.

Our latest full fundamental report of PCTY contains the most current fundamental analsysis.

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

Keep in mind

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.