PAYMENTUS HOLDINGS INC-A (NYSE:PAY) – A CANSLIM Candidate with Strong Growth Metrics

PAYMENTUS HOLDINGS INC-A (NYSE:PAY) surfaced in our CANSLIM stock screen due to its strong earnings and revenue growth, key traits sought by investors following William O’Neil’s strategy. The company, which provides cloud-based bill payment solutions, demonstrates several characteristics that align with the CANSLIM framework. Below, we examine why PAY stands out.

Key CANSLIM Criteria Met by PAY

• Earnings Growth (C & A): PAY reported a 40% year-over-year increase in quarterly EPS, well above the 20% minimum suggested by CANSLIM. Revenue growth was even stronger at 48.9%, indicating robust demand for its services. Over the past three years, EPS has grown at an annualized rate of 79.3%, far exceeding the 25% benchmark.
• Return on Equity (A): With an ROE of 10.14%, PAY meets the CANSLIM requirement of at least 10%, reflecting efficient use of shareholder capital.
• Debt-Free Balance Sheet (S): The company carries no debt, resulting in a debt-to-equity ratio of 0—a positive for supply and demand dynamics.
• Relative Strength (L): PAY’s relative strength score of 89.8 means it outperforms nearly 90% of stocks, a hallmark of market leadership.
• Institutional Sponsorship (I): Institutional ownership stands at 77.9%, below the 85% threshold, suggesting room for further institutional accumulation.

Technical and Fundamental Snapshot

• Fundamental Health: PAY’s financials are solid, with strong liquidity (current ratio of 4.46) and no solvency concerns. However, its valuation is elevated, with a P/E of 57.5, which may deter value-focused investors.
• Technical Outlook: The stock’s short-term trend is negative, but its long-term trend remains neutral. Recent price action has been volatile, with PAY trading near the lower end of its one-month range.

For a deeper dive, review the full fundamental analysis and technical report.

Our CANSLIM High Growth screener lists more stocks fitting this strategy and is updated daily.

Disclaimer

This is not investing advice! The article highlights observations at the time of writing, but you should conduct your own analysis before making investment decisions.