PAYLOCITY HOLDING CORP (PCTY) Stock Fundamental Analysis
NASDAQ:PCTY - Nasdaq - US70438V1061 - Common Stock
We assign a fundamental rating of 6 out of 10 to PCTY. PCTY was compared to 82 industry peers in the Professional Services industry. PCTY scores excellent points on both the profitability and health parts. This is a solid base for a good stock. PCTY shows excellent growth, but is valued quite expensive already. These ratings could make PCTY a good candidate for growth and quality investing.
1. Profitability
1.1 Basic Checks
PCTY had positive earnings in the past year.
In the past year PCTY had a positive cash flow from operations.
Each year in the past 5 years PCTY has been profitable.
In the past 5 years PCTY always reported a positive cash flow from operatings.
1.2 Ratios
PCTY's Return On Assets of 5.51% is in line compared to the rest of the industry. PCTY outperforms 59.49% of its industry peers.
PCTY has a Return On Equity of 20.06%. This is in the better half of the industry: PCTY outperforms 69.62% of its industry peers.
The Return On Invested Capital of PCTY (15.17%) is better than 79.75% of its industry peers.
The Average Return On Invested Capital over the past 3 years for PCTY is in line with the industry average of 13.48%.
The 3 year average ROIC (14.31%) for PCTY is below the current ROIC(15.17%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.51% | ||
| ROE | 20.06% | ||
| ROIC | 15.17% |
ROA(3y)3.52%
ROA(5y)3.35%
ROE(3y)17.17%
ROE(5y)16.56%
ROIC(3y)14.31%
ROIC(5y)12.35%
1.3 Margins
PCTY has a better Profit Margin (15.32%) than 87.34% of its industry peers.
In the last couple of years the Profit Margin of PCTY has grown nicely.
PCTY has a better Operating Margin (19.55%) than 86.08% of its industry peers.
PCTY's Operating Margin has improved in the last couple of years.
PCTY has a better Gross Margin (68.56%) than 82.28% of its industry peers.
PCTY's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.55% | ||
| PM (TTM) | 15.32% | ||
| GM | 68.56% |
OM growth 3Y25.31%
OM growth 5Y9.06%
PM growth 3Y9.79%
PM growth 5Y5.08%
GM growth 3Y1.51%
GM growth 5Y0.41%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), PCTY is creating some value.
Compared to 1 year ago, PCTY has less shares outstanding
PCTY has more shares outstanding than it did 5 years ago.
PCTY has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
2.2 Solvency
An Altman-Z score of 3.34 indicates that PCTY is not in any danger for bankruptcy at the moment.
PCTY has a Altman-Z score of 3.34. This is comparable to the rest of the industry: PCTY outperforms 56.96% of its industry peers.
PCTY has a debt to FCF ratio of 0.97. This is a very positive value and a sign of high solvency as it would only need 0.97 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 0.97, PCTY belongs to the top of the industry, outperforming 81.01% of the companies in the same industry.
A Debt/Equity ratio of 0.29 indicates that PCTY is not too dependend on debt financing.
PCTY has a Debt to Equity ratio (0.29) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.29 | ||
| Debt/FCF | 0.97 | ||
| Altman-Z | 3.34 |
ROIC/WACC1.62
WACC9.34%
2.3 Liquidity
A Current Ratio of 1.32 indicates that PCTY should not have too much problems paying its short term obligations.
PCTY's Current ratio of 1.32 is in line compared to the rest of the industry. PCTY outperforms 48.10% of its industry peers.
A Quick Ratio of 1.32 indicates that PCTY should not have too much problems paying its short term obligations.
The Quick ratio of PCTY (1.32) is comparable to the rest 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.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.32 | ||
| Quick Ratio | 1.32 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 22.58% over the past year.
PCTY shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 36.87% yearly.
PCTY shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 16.86%.
Measured over the past years, PCTY shows a very strong growth in Revenue. The Revenue has been growing by 24.57% on average per year.
EPS 1Y (TTM)22.58%
EPS 3Y46.1%
EPS 5Y36.87%
EPS Q2Q%18.57%
Revenue 1Y (TTM)16.86%
Revenue growth 3Y30.19%
Revenue growth 5Y24.57%
Sales Q2Q%14.29%
3.2 Future
PCTY is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 8.69% yearly.
Based on estimates for the next years, PCTY will show a quite strong growth in Revenue. The Revenue will grow by 10.47% on average per year.
EPS Next Y2.74%
EPS Next 2Y5.56%
EPS Next 3Y8.69%
EPS Next 5YN/A
Revenue Next Year10.75%
Revenue Next 2Y10.36%
Revenue Next 3Y10.67%
Revenue Next 5Y10.47%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 28.66 indicates a quite expensive valuation of PCTY.
PCTY's Price/Earnings is on the same level as the industry average.
When comparing the Price/Earnings ratio of PCTY to the average of the S&P500 Index (28.29), we can say PCTY is valued inline with the index average.
A Price/Forward Earnings ratio of 26.74 indicates a quite expensive valuation of PCTY.
Compared to the rest of the industry, the Price/Forward Earnings ratio of PCTY is on the same level as its industry peers.
The average S&P500 Price/Forward Earnings ratio is at 24.44. PCTY is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.66 | ||
| Fwd PE | 26.74 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, PCTY is valued a bit more expensive than the industry average as 70.89% of the companies are valued more cheaply.
PCTY's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 32.59 | ||
| EV/EBITDA | 28.99 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates PCTY does not grow enough to justify the current Price/Earnings ratio.
PCTY has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)10.48
PEG (5Y)0.78
EPS Next 2Y5.56%
EPS Next 3Y8.69%
5. Dividend
5.1 Amount
No dividends for PCTY!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
PAYLOCITY HOLDING CORP
NASDAQ:PCTY (1/22/2025, 2:10:02 PM)
196.02
-1.36 (-0.69%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryProfessional Services
Earnings (Last)
Earnings (Next)
Inst Owners79.26%
Inst Owner Change-0.11%
Ins Owners21%
Ins Owner Change-9.25%
Market Cap10.93B
Analysts80.8
Price Target215.89 (10.14%)
Short Float %2.02%
Short Ratio2.19
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)13.87%
Min EPS beat(2)12.35%
Max EPS beat(2)15.39%
EPS beat(4)4
Avg EPS beat(4)12.78%
Min EPS beat(4)9.15%
Max EPS beat(4)15.39%
EPS beat(8)8
Avg EPS beat(8)18.24%
EPS beat(12)12
Avg EPS beat(12)27.25%
EPS beat(16)16
Avg EPS beat(16)31.85%
Revenue beat(2)1
Avg Revenue beat(2)-0.08%
Min Revenue beat(2)-0.16%
Max Revenue beat(2)0.01%
Revenue beat(4)1
Avg Revenue beat(4)-2.77%
Min Revenue beat(4)-9.45%
Max Revenue beat(4)0.01%
Revenue beat(8)4
Avg Revenue beat(8)-1.17%
Revenue beat(12)7
Avg Revenue beat(12)-0.08%
Revenue beat(16)9
Avg Revenue beat(16)0.05%
PT rev (1m)4.41%
PT rev (3m)16.52%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-3.89%
EPS NY rev (1m)0%
EPS NY rev (3m)2.59%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-0.59%
Revenue NY rev (1m)0%
Revenue NY rev (3m)1.48%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.66 | ||
| Fwd PE | 26.74 | ||
| P/S | 7.55 | ||
| P/FCF | 32.59 | ||
| P/OCF | 26.39 | ||
| P/B | 9.88 | ||
| P/tB | 12.87 | ||
| EV/EBITDA | 28.99 |
EPS(TTM)6.84
EY3.49%
EPS(NY)7.33
Fwd EY3.74%
FCF(TTM)6.01
FCFY3.07%
OCF(TTM)7.43
OCFY3.79%
SpS25.97
BVpS19.84
TBVpS15.24
PEG (NY)10.48
PEG (5Y)0.78
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.51% | ||
| ROE | 20.06% | ||
| ROCE | 18.57% | ||
| ROIC | 15.17% | ||
| ROICexc | 31.02% | ||
| ROICexgc | 47.3% | ||
| OM | 19.55% | ||
| PM (TTM) | 15.32% | ||
| GM | 68.56% | ||
| FCFM | 23.16% |
ROA(3y)3.52%
ROA(5y)3.35%
ROE(3y)17.17%
ROE(5y)16.56%
ROIC(3y)14.31%
ROIC(5y)12.35%
ROICexc(3y)20.75%
ROICexc(5y)19.24%
ROICexgc(3y)32.29%
ROICexgc(5y)28.5%
ROCE(3y)17.51%
ROCE(5y)15.12%
ROICexcg growth 3Y31.83%
ROICexcg growth 5Y6.25%
ROICexc growth 3Y26.81%
ROICexc growth 5Y3.47%
OM growth 3Y25.31%
OM growth 5Y9.06%
PM growth 3Y9.79%
PM growth 5Y5.08%
GM growth 3Y1.51%
GM growth 5Y0.41%
F-Score6
Asset Turnover0.36
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.29 | ||
| Debt/FCF | 0.97 | ||
| Debt/EBITDA | 0.89 | ||
| Cap/Depr | 97.3% | ||
| Cap/Sales | 5.43% | ||
| Interest Coverage | 547.48 | ||
| Cash Conversion | 113.77% | ||
| Profit Quality | 151.17% | ||
| Current Ratio | 1.32 | ||
| Quick Ratio | 1.32 | ||
| Altman-Z | 3.34 |
F-Score6
WACC9.34%
ROIC/WACC1.62
Cap/Depr(3y)105.89%
Cap/Depr(5y)103.58%
Cap/Sales(3y)5.83%
Cap/Sales(5y)6.2%
Profit Quality(3y)138.04%
Profit Quality(5y)129.17%
High Growth Momentum
Growth
EPS 1Y (TTM)22.58%
EPS 3Y46.1%
EPS 5Y36.87%
EPS Q2Q%18.57%
EPS Next Y2.74%
EPS Next 2Y5.56%
EPS Next 3Y8.69%
EPS Next 5YN/A
Revenue 1Y (TTM)16.86%
Revenue growth 3Y30.19%
Revenue growth 5Y24.57%
Sales Q2Q%14.29%
Revenue Next Year10.75%
Revenue Next 2Y10.36%
Revenue Next 3Y10.67%
Revenue Next 5Y10.47%
EBIT growth 1Y49.6%
EBIT growth 3Y63.14%
EBIT growth 5Y35.86%
EBIT Next Year29.13%
EBIT Next 3Y18.5%
EBIT Next 5Y17.29%
FCF growth 1Y174.86%
FCF growth 3Y52.18%
FCF growth 5Y29.62%
OCF growth 1Y135.78%
OCF growth 3Y45.49%
OCF growth 5Y27.31%