
Paycom Software (PAYC) Stock Forecast & Price Target
Paycom Software (PAYC) Analyst Ratings
Bulls say
Paycom Software has demonstrated impressive growth, with its client count increasing from 12,800 in 2014 to over 37,500 in 2024, reflecting a compound annual growth rate (CAGR) of 16% during this period. The company has benefited from strong client acquisitions and cross-selling of additional modules, particularly between 2021 and 2022, alongside favorable conditions such as rising interest rates. Additionally, capital expenditures as a percentage of revenue are expected to remain elevated due to strategic investments in technology, which are anticipated to support future growth initiatives like the rollout of their IWant platform.
Bears say
Paycom Software is facing significant headwinds as it anticipates a decline in New Annual Recurring Revenue (ARR) by 15%, despite a projected 11% year-over-year increase in recurring and other revenues for 4Q25, amounting to $516 million. Additionally, the company's gross margin is expected to face downward pressure due to depreciation associated with a $130 million investment in GPUs, potentially resulting in margins that fall short of current consensus estimates. Compounding these challenges, customer retention rates have deteriorated from 94% in 2021 to 90% in 2023, primarily due to competitive pressures and the introduction of new offerings like Beti.
This aggregate rating is based on analysts' research of Paycom Software and is not a guaranteed prediction by Public.com or investment advice.
Paycom Software (PAYC) Analyst Forecast & Price Prediction
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