Paycom Software (NYSE:PAYC) Announces Quarterly Earnings Results

Paycom Software (NYSE:PAYC) issued its earnings results on Wednesday. The software maker reported $2.78 earnings per share for the quarter, beating analysts’ consensus estimates of $2.38 by $0.40, FiscalAI reports. The company had revenue of $531.20 million for the quarter, compared to the consensus estimate of $513.12 million. Paycom Software had a return on equity of 28.34% and a net margin of 22.44%.The firm’s quarterly revenue was up 9.8% on a year-over-year basis. During the same quarter in the prior year, the company earned $2.06 EPS.

Here are the key takeaways from Paycom Software’s conference call:

• Paycom reported Q2 revenue of $531 million, up 10% year over year, while adjusted EBITDA rose to $235 million, with a 44.2% margin that expanded 320 basis points. Management said results were broad-based and exceeded expectations.
• The company raised its 2026 outlook, now forecasting revenue of $2.197 billion-$2.212 billion and adjusted EBITDA of $1.007 billion-$1.022 billion, implying a record 46% margin at the midpoint. Paycom also expects 2026 free cash flow to exceed $650 million.
• Management highlighted continued operating efficiencies from automation, including lower labor and process costs, while investments in internally hosted AI models are expected to generate roughly $100 million in R&D savings and at least $30 million in reduced third-party response fees this year.
• Paycom repurchased approximately 2.6 million shares for $346 million during the quarter and nearly 11 million shares for $1.4 billion in the first half, reducing shares outstanding by 20%. The company ended the quarter with $1.66 billion remaining under its buyback authorization and approved a quarterly dividend of $0.375 per share.
• Product momentum remains a key strategic focus: Project Arc improved customization and scalability, while career and succession planning and the newly launched Asset Management solution are receiving positive early client feedback. Management expects these newer products to contribute more meaningfully over time, though their impact on Q2 was limited.

Paycom Software Stock Down 0.2%

PAYC stock traded down $0.31 during trading hours on Wednesday, hitting $174.99. The company’s stock had a trading volume of 818,560 shares, compared to its average volume of 781,453. The stock has a 50 day moving average price of $141.40 and a two-hundred day moving average price of $133.66. Paycom Software has a 12 month low of $104.90 and a 12 month high of $248.95. The company has a market capitalization of $8.33 billion, a PE ratio of 20.23, a price-to-earnings-growth ratio of 1.49 and a beta of 0.76. The company has a quick ratio of 1.08, a current ratio of 1.08 and a debt-to-equity ratio of 0.83.

Paycom Software Dividend Announcement

The firm also recently announced a quarterly dividend, which will be paid on Tuesday, September 8th. Shareholders of record on Monday, August 24th will be given a $0.375 dividend. This represents a $1.50 annualized dividend and a yield of 0.9%. The ex-dividend date of this dividend is Monday, August 24th. Paycom Software’s payout ratio is currently 17.34%.

Analyst Ratings Changes

A number of brokerages recently commented on PAYC. UBS Group lowered their price objective on shares of Paycom Software from $210.00 to $183.00 and set a “buy” rating on the stock in a research report on Tuesday, April 21st. TD Cowen cut their target price on shares of Paycom Software from $154.00 to $149.00 and set a “buy” rating for the company in a research report on Friday, June 26th. Barclays lifted their target price on shares of Paycom Software from $148.00 to $154.00 and gave the company an “equal weight” rating in a research note on Tuesday, July 21st. Citigroup upped their price target on shares of Paycom Software from $120.00 to $136.00 and gave the stock a “neutral” rating in a research note on Thursday, May 7th. Finally, BTIG Research lifted their price objective on Paycom Software from $140.00 to $160.00 and gave the company a “buy” rating in a research report on Thursday, May 7th. One equities research analyst has rated the stock with a Strong Buy rating, five have assigned a Buy rating and eight have issued a Hold rating to the company. According to MarketBeat.com, the company currently has a consensus rating of “Moderate Buy” and a consensus price target of $159.75.

Institutional Investors Weigh In On Paycom Software

Several institutional investors and hedge funds have recently modified their holdings of PAYC. Brighton Jones LLC bought a new position in Paycom Software during the fourth quarter valued at about $638,000. Holocene Advisors LP bought a new stake in shares of Paycom Software during the 2nd quarter worth about $728,000. Norinchukin Bank The increased its holdings in shares of Paycom Software by 6.1% during the 3rd quarter. Norinchukin Bank The now owns 3,231 shares of the software maker’s stock valued at $672,000 after acquiring an additional 187 shares during the last quarter. Caitlin John LLC increased its holdings in shares of Paycom Software by 2,879.7% during the 4th quarter. Caitlin John LLC now owns 4,112 shares of the software maker’s stock valued at $655,000 after acquiring an additional 3,974 shares during the last quarter. Finally, Janus Henderson Group PLC raised its stake in shares of Paycom Software by 2.2% in the 4th quarter. Janus Henderson Group PLC now owns 4,090 shares of the software maker’s stock valued at $652,000 after acquiring an additional 88 shares in the last quarter. Institutional investors and hedge funds own 87.77% of the company’s stock.

About Paycom Software

Paycom Software, Inc (NYSE: PAYC) is a cloud-based human capital management (HCM) software provider that delivers an end-to-end solution for human resources, payroll, talent acquisition, time and labor management, and talent management. Its single-database platform enables organizations to process payroll, track time, administer benefits, and manage recruiting and employee development through a unified system. Paycom’s software is designed to streamline administrative tasks, improve data accuracy, and provide real-time reporting and analytics to support strategic HR decisions.

The company’s core offerings include payroll processing with built-in tax compliance, employee self-service functionality, automated time tracking, and customizable talent acquisition tools that allow employers to create and post job requisitions, screen candidates, and conduct onboarding electronically.