PAYLOCITY HOLDING CORP (PCTY)
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 gets an excellent profitability rating and is at the same time showing great financial health properties. PCTY is valued quite expensive, but it does show an excellent growth. These ratings would make PCTY suitable 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.
In the past 5 years PCTY has always been profitable.
PCTY had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
PCTY has a Return On Assets (3.94%) which is comparable to the rest of the industry.
Looking at the Return On Equity, with a value of 17.76%, PCTY is in the better half of the industry, outperforming 75.31% of the companies in the same industry.
PCTY has a Return On Invested Capital of 18.43%. This is amongst the best in the industry. PCTY outperforms 85.19% 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 11.74%.
The last Return On Invested Capital (18.43%) for PCTY is above the 3 year average (11.96%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.94% | ||
| ROE | 17.76% | ||
| ROIC | 18.43% |
ROA(3y)2.88%
ROA(5y)2.97%
ROE(3y)15.45%
ROE(5y)16.05%
ROIC(3y)11.96%
ROIC(5y)12.19%
1.3 Margins
PCTY's Profit Margin of 14.42% is amongst the best of the industry. PCTY outperforms 86.42% of its industry peers.
PCTY's Profit Margin has improved in the last couple of years.
PCTY has a Operating Margin of 18.22%. This is amongst the best in the industry. PCTY outperforms 86.42% of its industry peers.
PCTY's Operating Margin has improved in the last couple of years.
The Gross Margin of PCTY (68.85%) is better than 83.95% of its industry peers.
PCTY's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 18.22% | ||
| PM (TTM) | 14.42% | ||
| GM | 68.85% |
OM growth 3Y1.95%
OM growth 5Y25.66%
PM growth 3Y1.42%
PM growth 5Y3.23%
GM growth 3Y0.58%
GM growth 5Y2.6%
2. Health
2.1 Basic Checks
PCTY has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
The number of shares outstanding for PCTY has been increased compared to 1 year ago.
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
PCTY has an Altman-Z score of 2.17. This is not the best score and indicates that PCTY is in the grey zone with still only limited risk for bankruptcy at the moment.
The Altman-Z score of PCTY (2.17) is worse than 60.49% of its industry peers.
PCTY has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | 0 | ||
| Altman-Z | 2.17 |
ROIC/WACC2.03
WACC9.09%
2.3 Liquidity
A Current Ratio of 1.13 indicates that PCTY should not have too much problems paying its short term obligations.
PCTY has a worse Current ratio (1.13) than 62.96% of its industry peers.
PCTY has a Quick Ratio of 1.13. This is a normal value and indicates that PCTY is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.13, PCTY is doing worse than 61.73% of the companies in the same 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 | 1.13 | ||
| Quick Ratio | 1.13 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 38.36% over the past year.
PCTY shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 32.16% yearly.
PCTY shows a strong growth in Revenue. In the last year, the Revenue has grown by 23.62%.
PCTY shows a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 25.49% yearly.
EPS 1Y (TTM)38.36%
EPS 3Y40.26%
EPS 5Y32.16%
EPS growth Q2Q27.01%
Revenue 1Y (TTM)23.62%
Revenue growth 3Y27.91%
Revenue growth 5Y25.49%
Revenue growth Q2Q18.06%
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 15.35% yearly.
Based on estimates for the next years, PCTY will show a quite strong growth in Revenue. The Revenue will grow by 14.99% on average per year.
EPS Next Y21.15%
EPS Next 2Y14.92%
EPS Next 3Y15.35%
EPS Next 5YN/A
Revenue Next Year18.81%
Revenue Next 2Y16.05%
Revenue Next 3Y15.46%
Revenue Next 5Y14.99%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past 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 25.49 indicates a quite expensive valuation of PCTY.
Compared to the rest of the industry, the Price/Earnings ratio of PCTY is on the same level as its industry peers.
The average S&P500 Price/Earnings ratio is at 28.43. PCTY is around the same levels.
With a Price/Forward Earnings ratio of 24.01, PCTY is valued on the expensive side.
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 20.51. PCTY is around the same levels.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.49 | ||
| Fwd PE | 24.01 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, PCTY is valued a bit more expensive than 71.60% of the companies in the same industry.
The rest of the industry has a similar Price/Free Cash Flow ratio as PCTY.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 30.96 | ||
| EV/EBITDA | 27.4 |
4.3 Compensation for Growth
PCTY's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PCTY has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as PCTY's earnings are expected to grow with 15.35% in the coming years.
PEG (NY)1.21
PEG (5Y)0.79
EPS Next 2Y14.92%
EPS Next 3Y15.35%
5. Dividend
5.1 Amount
No dividends for PCTY!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
PAYLOCITY HOLDING CORP
NASDAQ:PCTY (5/10/2024, 7:12:10 PM)
After market: 163.62 0 (0%)163.62
-0.17 (-0.1%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryProfessional Services
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
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Market Cap9.22B
Analysts
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Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
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Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.49 | ||
| Fwd PE | 24.01 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
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SpS
BVpS
TBVpS
PEG (NY)1.21
PEG (5Y)0.79
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.94% | ||
| ROE | 17.76% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 18.22% | ||
| PM (TTM) | 14.42% | ||
| GM | 68.85% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.27
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.13 | ||
| Quick Ratio | 1.13 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)38.36%
EPS 3Y40.26%
EPS 5Y
EPS growth Q2Q
EPS Next Y21.15%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)23.62%
Revenue growth 3Y27.91%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
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EBIT growth 3Y
EBIT growth 5Y
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