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In the latest trading session, Paycom Software (PAYC) closed at $498.09, marking a +0.71% move from the previous day. This move lagged the S&P 500’s daily gain of 1.05%.
Coming into today, shares of the maker of human-resources and payroll software had lost 0.33% in the past month. In that same time, the Computer and Technology sector lost 9.29%, while the S&P 500 lost 5.07%.
Investors will be hoping for strength from PAYC as it approaches its next earnings release. The company is expected to report EPS of $0.91, up 30% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $250.37 million, up 27.39% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $4.39 per share and revenue of $1.04 billion. These totals would mark changes of +25.79% and +23.31%, respectively, from last year.
Investors should also note any recent changes to analyst estimates for PAYC. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company’s business outlook.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. PAYC currently has a Zacks Rank of #3 (Hold).
Digging into valuation, PAYC currently has a Forward P/E ratio of 112.56. This represents a premium compared to its industry’s average Forward P/E of 56.51.
Investors should also note that PAYC has a PEG ratio of 4.5 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate. The Internet – Software was holding an average PEG ratio of 3.92 at yesterday’s closing price.
The Internet – Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 170, which puts it in the bottom 34% of all 250+ industries.
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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Paycom Software, Inc. (PAYC): Free Stock Analysis Report
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