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NYSE:PAYC—Positioned as a High-Growth Stock, Ready for a Potential Breakout.

By Mill Chart

Last update: Feb 28, 2024

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

Unpacking NYSE:PAYC's Growth Rating

To evaluate a stock's growth potential, ChartMill utilizes a Growth Rating on a scale of 0 to 10. This comprehensive assessment considers various growth aspects, including historical and estimated EPS and revenue growth. NYSE:PAYC has achieved a 8 out of 10:

  • PAYC shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 26.30%, which is quite impressive.
  • The Earnings Per Share has been growing by 23.85% on average over the past years. This is a very strong growth
  • PAYC shows a strong growth in Revenue. In the last year, the Revenue has grown by 23.15%.
  • The Revenue has been growing by 24.50% on average over the past years. This is a very strong growth!
  • PAYC is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 11.85% yearly.
  • The Revenue is expected to grow by 11.73% on average over the next years. This is quite good.

Health Examination for NYSE:PAYC

To gauge a stock's financial health, ChartMill utilizes a Health Rating on a scale of 0 to 10. This comprehensive evaluation encompasses liquidity and solvency, both in absolute terms and in comparison to industry peers. NYSE:PAYC has earned a 8 out of 10:

  • An Altman-Z score of 3.47 indicates that PAYC is not in any danger for bankruptcy at the moment.
  • Looking at the Altman-Z score, with a value of 3.47, PAYC is in the better half of the industry, outperforming 63.75% of the companies in the same industry.
  • 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.

Understanding NYSE:PAYC's Profitability

Discover ChartMill's exclusive Profitability Rating, a proprietary metric that assesses stocks on a scale of 0 to 10. It takes into consideration various profitability ratios and margins, both in absolute terms and relative to industry peers. Notably, NYSE:PAYC has achieved a 8:

  • PAYC has a better Return On Assets (8.12%) than 80.00% of its industry peers.
  • PAYC's Return On Equity of 26.15% is amongst the best of the industry. PAYC outperforms 82.50% of its industry peers.
  • Looking at the Return On Invested Capital, with a value of 19.59%, PAYC belongs to the top of the industry, outperforming 86.25% of the companies in the same industry.
  • PAYC had an Average Return On Invested Capital over the past 3 years of 17.49%. This is significantly above the industry average of 11.98%.
  • The last Return On Invested Capital (19.59%) for PAYC is above the 3 year average (17.49%), which is a sign of increasing profitability.
  • With an excellent Profit Margin value of 20.12%, PAYC belongs to the best of the industry, outperforming 92.50% of the companies in the same industry.
  • PAYC has a better Operating Margin (26.65%) than 91.25% of its industry peers.
  • PAYC's Gross Margin of 83.69% is amongst the best of the industry. PAYC outperforms 93.75% of its industry peers.

How does the Setup look for NYSE:PAYC

ChartMill takes into account not only the Technical Rating but also assigns a Setup Rating to each stock. This rating, on a scale of 0 to 10, reflects the degree of consolidation observed based on short-term technical indicators. Currently, NYSE:PAYC exhibits a 7 setup rating, indicating its consolidation status in recent days and weeks.

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.

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

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

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

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.

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PAYCOM SOFTWARE INC

NYSE:PAYC (5/24/2024, 7:04:00 PM)

After market: 170.68 0 (0%)

170.68

-3.76 (-2.16%)

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