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PAYLOCITY HOLDING CORP (PCTY) Stock Fundamental Analysis

NASDAQ:PCTY - Nasdaq - US70438V1061 - Common Stock - Currency: USD

176.81  -5.17 (-2.84%)

After market: 176.81 0 (0%)

Fundamental Rating

6

Overall PCTY gets a fundamental rating of 6 out of 10. We evaluated PCTY against 82 industry peers in the Professional Services industry. While PCTY has a great profitability rating, there are some minor concerns on its financial health. PCTY shows excellent growth, but is valued quite expensive already. These ratings would make PCTY suitable for growth investing!


Dividend Valuation Growth Profitability Health

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8

1. Profitability

1.1 Basic Checks

In the past year PCTY was profitable.
In the past year PCTY had a positive cash flow from operations.
In the past 5 years PCTY has always been profitable.
Each year in the past 5 years PCTY had a positive operating cash flow.
PCTY Yearly Net Income VS EBIT VS OCF VS FCFPCTY Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 100M 200M 300M

1.2 Ratios

Looking at the Return On Assets, with a value of 4.40%, PCTY is in line with its industry, outperforming 56.10% of the companies in the same industry.
PCTY has a better Return On Equity (18.81%) than 68.29% of its industry peers.
Looking at the Return On Invested Capital, with a value of 15.92%, PCTY belongs to the top of the industry, outperforming 84.15% of the companies in the same industry.
PCTY had an Average Return On Invested Capital over the past 3 years of 14.31%. This is in line with the industry average of 12.61%.
The last Return On Invested Capital (15.92%) for PCTY is above the 3 year average (14.31%), which is a sign of increasing profitability.
Industry RankSector Rank
ROA 4.4%
ROE 18.81%
ROIC 15.92%
ROA(3y)3.52%
ROA(5y)3.35%
ROE(3y)17.17%
ROE(5y)16.56%
ROIC(3y)14.31%
ROIC(5y)12.35%
PCTY Yearly ROA, ROE, ROICPCTY Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 10 -10 20

1.3 Margins

PCTY's Profit Margin of 14.65% is amongst the best of the industry. PCTY outperforms 85.37% of its industry peers.
PCTY's Profit Margin has improved in the last couple of years.
The Operating Margin of PCTY (19.38%) is better than 87.80% of its industry peers.
PCTY's Operating Margin has improved in the last couple of years.
The Gross Margin of PCTY (68.67%) is better than 82.93% of its industry peers.
PCTY's Gross Margin has been stable in the last couple of years.
Industry RankSector Rank
OM 19.38%
PM (TTM) 14.65%
GM 68.67%
OM growth 3Y25.31%
OM growth 5Y9.06%
PM growth 3Y9.79%
PM growth 5Y5.08%
GM growth 3Y1.51%
GM growth 5Y0.41%
PCTY Yearly Profit, Operating, Gross MarginsPCTY Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 20 40 60

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5

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.
PCTY has less shares outstanding than it did 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.
PCTY Yearly Shares OutstandingPCTY Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 10M 20M 30M 40M 50M
PCTY Yearly Total Debt VS Total AssetsPCTY Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 1B 2B 3B 4B

2.2 Solvency

An Altman-Z score of 2.36 indicates that PCTY is not a great score, but indicates only limited risk for bankruptcy at the moment.
The Altman-Z score of PCTY (2.36) is comparable to the rest of the industry.
The Debt to FCF ratio of PCTY is 0.73, which is an excellent value as it means it would take PCTY, only 0.73 years of fcf income to pay off all of its debts.
PCTY has a Debt to FCF ratio of 0.73. This is amongst the best in the industry. PCTY outperforms 80.49% of its industry peers.
PCTY has a Debt/Equity ratio of 0.20. This is a healthy value indicating a solid balance between debt and equity.
PCTY has a Debt to Equity ratio (0.20) which is comparable to the rest of the industry.
Industry RankSector Rank
Debt/Equity 0.2
Debt/FCF 0.73
Altman-Z 2.36
ROIC/WACC1.76
WACC9.05%
PCTY Yearly LT Debt VS Equity VS FCFPCTY Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 0 200M 400M 600M 800M 1B

2.3 Liquidity

PCTY has a Current 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 Current ratio, with a value of 1.13, PCTY is doing worse than 62.20% of the companies in the same industry.
A Quick Ratio of 1.13 indicates that PCTY should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.13, PCTY is doing worse than 62.20% of the companies in the same industry.
Industry RankSector Rank
Current Ratio 1.13
Quick Ratio 1.13
PCTY Yearly Current Assets VS Current LiabilitesPCTY Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 1B 2B 3B 4B

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8

3. Growth

3.1 Past

The Earnings Per Share has grown by an nice 10.44% 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.
The Revenue has grown by 14.63% in the past year. This is quite good.
The Revenue has been growing by 24.57% on average over the past years. This is a very strong growth!
EPS 1Y (TTM)10.44%
EPS 3Y46.1%
EPS 5Y36.87%
EPS Q2Q%9.95%
Revenue 1Y (TTM)14.63%
Revenue growth 3Y30.19%
Revenue growth 5Y24.57%
Sales Q2Q%23.91%

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 14.81% yearly.
Based on estimates for the next years, PCTY will show a quite strong growth in Revenue. The Revenue will grow by 10.36% on average per year.
EPS Next Y7.7%
EPS Next 2Y5.73%
EPS Next 3Y7.6%
EPS Next 5Y14.81%
Revenue Next Year13.42%
Revenue Next 2Y11.02%
Revenue Next 3Y10.71%
Revenue Next 5Y10.36%

3.3 Evolution

The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in 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.
PCTY Yearly Revenue VS EstimatesPCTY Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 1B 2B 3B
PCTY Yearly EPS VS EstimatesPCTY Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 0 2 4 6 8 10

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2

4. Valuation

4.1 Price/Earnings Ratio

With a Price/Earnings ratio of 24.94, PCTY is valued on the expensive side.
The rest of the industry has a similar Price/Earnings ratio as PCTY.
The average S&P500 Price/Earnings ratio is at 26.60. PCTY is around the same levels.
A Price/Forward Earnings ratio of 24.04 indicates a rather expensive valuation of PCTY.
The rest of the industry has a similar Price/Forward Earnings ratio as PCTY.
When comparing the Price/Forward Earnings ratio of PCTY to the average of the S&P500 Index (22.39), we can say PCTY is valued inline with the index average.
Industry RankSector Rank
PE 24.94
Fwd PE 24.04
PCTY Price Earnings VS Forward Price EarningsPCTY Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, PCTY is valued a bit more expensive than the industry average as 63.41% of the companies are valued more cheaply.
PCTY's Price/Free Cash Flow ratio is in line with the industry average.
Industry RankSector Rank
P/FCF 29.08
EV/EBITDA 24.88
PCTY Per share dataPCTY EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 5 10 15 20 25

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of PCTY may justify a higher PE ratio.
PEG (NY)3.24
PEG (5Y)0.68
EPS Next 2Y5.73%
EPS Next 3Y7.6%

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0

5. Dividend

5.1 Amount

No dividends for PCTY!.
Industry RankSector Rank
Dividend Yield N/A

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PAYLOCITY HOLDING CORP

NASDAQ:PCTY (6/13/2025, 4:14:59 PM)

After market: 176.81 0 (0%)

176.81

-5.17 (-2.84%)

Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryProfessional Services
Earnings (Last)05-01 2025-05-01/amc
Earnings (Next)07-30 2025-07-30/amc
Inst Owners81.71%
Inst Owner Change1.22%
Ins Owners19.64%
Ins Owner Change-1.74%
Market Cap9.77B
Analysts81.54
Price Target231.27 (30.8%)
Short Float %2.44%
Short Ratio2.66
Dividend
Industry RankSector 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)8.04%
Min EPS beat(2)4.67%
Max EPS beat(2)11.41%
EPS beat(4)4
Avg EPS beat(4)10.96%
Min EPS beat(4)4.67%
Max EPS beat(4)15.39%
EPS beat(8)8
Avg EPS beat(8)12.56%
EPS beat(12)12
Avg EPS beat(12)21.2%
EPS beat(16)16
Avg EPS beat(16)27.83%
Revenue beat(2)2
Avg Revenue beat(2)0.5%
Min Revenue beat(2)0.3%
Max Revenue beat(2)0.7%
Revenue beat(4)3
Avg Revenue beat(4)0.21%
Min Revenue beat(4)-0.16%
Max Revenue beat(4)0.7%
Revenue beat(8)4
Avg Revenue beat(8)-1.43%
Revenue beat(12)8
Avg Revenue beat(12)-0.16%
Revenue beat(16)11
Avg Revenue beat(16)0.23%
PT rev (1m)0.37%
PT rev (3m)-7.14%
EPS NQ rev (1m)-0.93%
EPS NQ rev (3m)1.3%
EPS NY rev (1m)3.78%
EPS NY rev (3m)3.71%
Revenue NQ rev (1m)-0.2%
Revenue NQ rev (3m)1.5%
Revenue NY rev (1m)0.31%
Revenue NY rev (3m)1.13%
Valuation
Industry RankSector Rank
PE 24.94
Fwd PE 24.04
P/S 6.29
P/FCF 29.08
P/OCF 23.73
P/B 8.08
P/tB 15.29
EV/EBITDA 24.88
EPS(TTM)7.09
EY4.01%
EPS(NY)7.36
Fwd EY4.16%
FCF(TTM)6.08
FCFY3.44%
OCF(TTM)7.45
OCFY4.21%
SpS28.1
BVpS21.89
TBVpS11.56
PEG (NY)3.24
PEG (5Y)0.68
Profitability
Industry RankSector Rank
ROA 4.4%
ROE 18.81%
ROCE 19.49%
ROIC 15.92%
ROICexc 23.07%
ROICexgc 49.64%
OM 19.38%
PM (TTM) 14.65%
GM 68.67%
FCFM 21.64%
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 Turnover0.3
Health
Industry RankSector Rank
Debt/Equity 0.2
Debt/FCF 0.73
Debt/EBITDA 0.62
Cap/Depr 80.72%
Cap/Sales 4.88%
Interest Coverage 31.1
Cash Conversion 104.32%
Profit Quality 147.73%
Current Ratio 1.13
Quick Ratio 1.13
Altman-Z 2.36
F-Score6
WACC9.05%
ROIC/WACC1.76
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)10.44%
EPS 3Y46.1%
EPS 5Y36.87%
EPS Q2Q%9.95%
EPS Next Y7.7%
EPS Next 2Y5.73%
EPS Next 3Y7.6%
EPS Next 5Y14.81%
Revenue 1Y (TTM)14.63%
Revenue growth 3Y30.19%
Revenue growth 5Y24.57%
Sales Q2Q%23.91%
Revenue Next Year13.42%
Revenue Next 2Y11.02%
Revenue Next 3Y10.71%
Revenue Next 5Y10.36%
EBIT growth 1Y21.94%
EBIT growth 3Y63.14%
EBIT growth 5Y35.86%
EBIT Next Year37.49%
EBIT Next 3Y18.47%
EBIT Next 5Y18.68%
FCF growth 1Y63.59%
FCF growth 3Y52.18%
FCF growth 5Y29.62%
OCF growth 1Y60.9%
OCF growth 3Y45.49%
OCF growth 5Y27.31%