The S&P 500 returned an average of 184% during past bull markets, and it realized those returns over roughly 64 months. If the current bull market aligns with the historical average, the index will advance 131% over the next 44 months. But even if those gains fail to materialize, investors have good reason to believe the stock market will soar in the long run. Shopify: A leader in retail e-commerce software that is gaining momentum in wholesale Notably, management said B2B gross merchandise volume rose 130% ...

While 11% revenue growth isn't terrible, it's a far cry from what Paycom investors are used to. Excluding the early pandemic when layoffs and furloughs were the norm, Paycom has historically managed a revenue growth rate of 30% or higher. This highly profitable software company is finally trading at an attractive valuation. Since the stock peaked in late 2021, payroll and human resources software provider Paycom (PAYC 1.02%) has been a disaster for investors. Shares are down a whopping 74% from that all-tim ...

Core Viewpoint - Investors in Paycom Software, Inc. (PAYC) should closely monitor the stock due to significant implied volatility in the options market, particularly for the Jun 21, 2024 $75 Call option [1] Company Analysis - Paycom Software currently holds a Zacks Rank 3 (Hold) in the Internet – Software industry, which is in the top 26% of the Zacks Industry Rank [3] - Over the past 30 days, one analyst has raised the earnings estimate for the current quarter, while five analysts have lowered their estimates, resulting in a decrease of the Zacks Consensus Estimate from $1.66 per share to $1.59 [3] Options Market Insights - The high implied volatility suggests that options traders are anticipating a significant price movement for Paycom Software shares, indicating potential upcoming events that could lead to a major rally or sell-off [2][4] - Options traders often seek high implied volatility options to sell premium, aiming to benefit from the decay of the option's value if the underlying stock does not move as much as expected [4]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2024 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______ to ______ Commission File Number: 001-36393 Paycom Software, Inc. (Exact name of registrant as specified in its charter) Delaware 80-0957485 (State o ...

Paycom Software (PAYC) reported first-quarter 2024 results, wherein both the top and bottom lines surpassed the Zacks Consensus Estimate and improved year over year.The online payroll and human resource technology provider reported non-GAAP earnings of $2.59 per share in the first quarter, beating the Zacks Consensus Estimate of $2.43. The bottom line improved 5.28% from $2.46 per share reported in the year-ago quarter.Paycom reported revenues of $499.9 million, beating the consensus mark of $495.9 million. ...

Financial Data and Key Metrics Changes - First quarter revenue reached $500 million, an increase of 11% compared to the same period last year [22] - Recurring revenue was $492 million, representing 98% of total revenues and also growing 11% year-over-year [22] - GAAP net income was $247 million, or $4.37 per diluted share, influenced by a one-time non-cash stock compensation benefit of $118 million [23] - Non-GAAP net income for the first quarter was $147 million, or $2.59 per diluted share [23] - Adjusted EBITDA was nearly $230 million, with a margin of 45.9% for the quarter [24] Business Line Data and Key Metrics Changes - The company released more product enhancements in Q1 than in the previous two quarters combined, focusing on automation and AI [10][11] - The introduction of Beti has significantly reduced payroll processing time for clients, enhancing client ROI [10][12] Market Data and Key Metrics Changes - The average daily balance of funds held on behalf of clients was approximately $2.6 billion, up 8% year-over-year [26] - The company has only captured about 5% of the total addressable market in the U.S., indicating significant growth potential [16] Company Strategy and Development Direction - The strategic focus for 2024 includes solution automation, client ROI achievement, and world-class service [9][12] - The company is expanding internationally, having launched native payroll solutions in Canada, Mexico, the UK, and Ireland [15][16] - The go-to-market strategy emphasizes the unique value proposition of Paycom's offerings, particularly the benefits of self-service payroll [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the effectiveness of their client value achievement strategy, which aims to improve client retention and ROI [36][42] - The company anticipates a reacceleration in revenue growth in the second half of 2024, driven by front-loaded strategic initiatives [60] Other Important Information - The company has a strong balance sheet with cash and cash equivalents of $371 million and no debt [26] - The Board approved a quarterly dividend of $0.375 per share, payable in mid-June [24] Q&A Session Summary Question: Can you frame your strategic initiatives in relation to market demand and hiring headwinds? - Management highlighted their focus on client value achievement and improving retention, while also maintaining sales initiatives for new clients [36] Question: Can you discuss the benefits of fewer rate cuts this year? - Management noted that fewer rate cuts could be beneficial towards the end of the year, but they are also considering extending the duration of funds [38] Question: What are your assumptions regarding churn and new bookings in your guidance? - Management indicated stability in new bookings and improvements in retention due to ongoing client value initiatives [42] Question: How is sales performance varying across different offices? - Management stated that the best offices have the best managers, and there is no saturation in the mid-market, with continued competitive opportunities [46] Question: How do you feel about sales capacity and plans for new sales offices? - Management reported improvements in sales capacity and indicated that opening new offices depends on the success of current managers [53] Question: How is pre-employment services revenue trending? - Management characterized pre-employment services as stable, reflecting new client acquisitions and current client trends [56] Question: Can you elaborate on the impact of strategic initiatives on revenue? - Management acknowledged that some initiatives may delay revenue opportunities but are essential for long-term client ROI [62] Question: What are the top investment priorities for potential incremental investments? - Management emphasized continued investment in R&D and automation as key priorities [76] Question: Can you discuss the competitive environment and any notable changes? - Management noted that the competitive landscape remains unchanged, with a focus on leveraging automation to enhance client ROI [95]

[Paycom Software, Inc. First Quarter 2024 Results](index=1&type=section&id=Paycom%20Software%2C%20Inc.%20Reports%20First%20Quarter%202024%20Results) [Financial Highlights](index=1&type=section&id=Financial%20Highlights%20for%20the%20First%20Quarter%20of%202024) Paycom reported strong Q1 2024 results with total revenues of $500 million, GAAP Net Income of $247 million, and Adjusted EBITDA of $230 million, driven by its Beti product strategy Q1 2024 Key Financial Metrics (vs. Q1 2023) | Metric | Q1 2024 | Q1 2023 | Change | | :--- | :--- | :--- | :--- | | Total Revenues | $499.9M | $451.6M | +10.7% | | GAAP Net Income | $247.2M | $119.3M | +107.2% | | GAAP Diluted EPS | $4.37 | $2.06 | +112.1% | | Non-GAAP Net Income | $146.6M | $142.7M | +2.7% | | Non-GAAP Diluted EPS | $2.59 | $2.46 | +5.3% | | Adjusted EBITDA | $229.5M | $220.5M | +4.1% | - GAAP net income for Q1 2024 included a significant benefit of **$117.5 million** to general and administrative expenses, resulting from the forfeiture of the 2020 CEO performance award[4](index=4&type=chunk) - The company's strategy remains focused on expanding solution automation, increasing client ROI, and delivering world-class service, with the **Beti® product** leading this effort[2](index=2&type=chunk) - As of March 31, 2024, Paycom had **$371.3 million** in cash and cash equivalents and no total debt[5](index=5&type=chunk) [Financial Outlook](index=1&type=section&id=Financial%20Outlook) The company provided Q2 2024 revenue guidance of $434-$438 million and full-year 2024 revenue guidance of $1.86-$1.885 billion Financial Guidance | Period | Metric | Guidance Range | | :--- | :--- | :--- | | **Q2 2024** | Total Revenues | $434M - $438M | | | Adjusted EBITDA | $151M - $155M | | **Full Year 2024** | Total Revenues | $1.860B - $1.885B | | | Adjusted EBITDA | $720M - $730M | [Consolidated Financial Statements](index=4&type=section&id=Unaudited%20Consolidated%20Financial%20Statements) This section presents the unaudited consolidated financial statements, including Balance Sheets, Statements of Comprehensive Income, and Statements of Cash Flows [Unaudited Consolidated Balance Sheets](index=4&type=section&id=Unaudited%20Consolidated%20Balance%20Sheets) As of March 31, 2024, total assets reached $4.73 billion, with cash and equivalents at $371.3 million and total stockholders' equity at $1.44 billion Key Balance Sheet Items (in thousands) | Account | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $371,325 | $294,025 | | Total current assets | $3,296,326 | $2,813,426 | | Total assets | $4,733,264 | $4,197,539 | | Total current liabilities | $2,942,312 | $2,534,643 | | Total liabilities | $3,295,201 | $2,894,503 | | Total stockholders' equity | $1,438,063 | $1,303,036 | [Unaudited Consolidated Statements of Comprehensive Income](index=5&type=section&id=Unaudited%20Consolidated%20Statements%20of%20Comprehensive%20Income) Q1 2024 total revenues grew 10.7% to $499.9 million, with operating income at $285.8 million and GAAP Net Income at $247.2 million Q1 Income Statement Highlights (in thousands, except per share data) | Metric | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Total revenues | $499,881 | $451,637 | | Operating income | $285,814 | $160,432 | | Net income | $247,187 | $119,296 | | Earnings per share, diluted | $4.37 | $2.06 | [Unaudited Consolidated Statements of Cash Flows](index=6&type=section&id=Unaudited%20Consolidated%20Statements%20of%20Cash%20Flows) Q1 2024 net cash from operating activities was $148.6 million, with investing activities providing $42.3 million, and $21.2 million paid in dividends Cash Flow Summary (in thousands) | Activity | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net cash provided by operating activities | $148,636 | $146,103 | | Net cash provided by (used in) investing activities | $42,285 | $(40,618) | | Net cash provided by financing activities | $376,094 | $183,003 | - During the first quarter of 2024, Paycom paid **$21.2 million** in cash dividends and repurchased **15,681 shares** of common stock for **$3.1 million**[5](index=5&type=chunk)[21](index=21&type=chunk) [Reconciliation of GAAP to Non-GAAP Financial Measures](index=8&type=section&id=Unaudited%20Reconciliations%20of%20GAAP%20to%20Non-GAAP%20Financial%20Measures) This section details reconciliations of GAAP to non-GAAP financial measures, including Adjusted EBITDA of $229.5 million and Non-GAAP Net Income of $146.6 million [Reconciliation of Net Income to Adjusted EBITDA and Non-GAAP Net Income](index=8&type=section&id=Reconciliation%20of%20Net%20Income%20to%20Adjusted%20EBITDA%20and%20Non-GAAP%20Net%20Income) Q1 2024 GAAP Net Income of $247.2 million reconciles to Adjusted EBITDA of $229.5 million and Non-GAAP Net Income of $146.6 million, primarily adjusted for stock-based compensation Reconciliation of Net Income to Adjusted EBITDA (in thousands) | Line Item | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net income | $247,187 | $119,296 | | Adjustments (Taxes, Interest, D&A) | $76,104 | $73,412 | | EBITDA | $323,291 | $192,708 | | Non-cash stock-based compensation | $(93,790) | $27,819 | | **Adjusted EBITDA** | **$229,501** | **$220,527** | Reconciliation of Net Income to Non-GAAP Net Income (in thousands) | Line Item | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net income | $247,187 | $119,296 | | Non-cash stock-based compensation | $(93,790) | $27,819 | | Income tax effect on adjustments | $(6,749) | $(4,464) | | **Non-GAAP net income** | **$146,648** | **$142,651** | [Reconciliation of Expense and Profit Items](index=10&type=section&id=Reconciliation%20of%20Expense%20and%20Profit%20Items) This section details GAAP to non-GAAP adjustments for gross profit and expense lines, showing Q1 2024 adjusted gross margin at 84.9% and adjusted sales and marketing expenses at 22.0% of revenues Q1 2024 Adjusted vs. GAAP Margins (% of Revenues) | Metric | GAAP | Adjusted (Non-GAAP) | | :--- | :--- | :--- | | Gross Margin | 84.3% | 84.9% | | Sales and Marketing Expenses | 23.1% | 22.0% | | Research and Development Expenses | 10.1% | 9.0% | | Total R&D Costs | 16.1% | 14.3% | [Other Information](index=2&type=section&id=Other%20Information) This section provides supplementary information, including the rationale for non-GAAP measures and forward-looking statement disclaimers [Use of Non-GAAP Financial Information](index=2&type=section&id=Use%20of%20Non-GAAP%20Financial%20Information) Management uses non-GAAP measures to assess core business performance, enhance transparency for investors, and facilitate peer comparisons by excluding specific items - Management uses non-GAAP financial measures to supplement GAAP information for assessing core business performance, planning, and providing investors with greater transparency[10](index=10&type=chunk) - The company believes these non-GAAP metrics are useful for comparing its core operations across periods and against peer companies[10](index=10&type=chunk) [Forward-Looking Statements](index=2&type=section&id=Forward-Looking%20Statements) This section contains a standard safe harbor statement, cautioning that forward-looking statements are subject to risks and actual results may differ materially - Forward-looking statements in the report cover topics such as business strategy, future operating results, competition, and growth plans[14](index=14&type=chunk) - These statements are based only on information currently available, speak only as of the date of the release, and are subject to risks that could cause actual results to differ materially[15](index=15&type=chunk)

The most recent trading session ended with Paycom Software (PAYC) standing at $198.28, reflecting a -0.37% shift from the previouse trading day's closing. This change lagged the S&P 500's daily loss of 0.2%. Meanwhile, the Dow lost 0.6%, and the Nasdaq, a tech-heavy index, added 0.11%.Prior to today's trading, shares of the maker of human-resources and payroll software had gained 7.72% over the past month. This has outpaced the Computer and Technology sector's gain of 2.99% and the S&P 500's gain of 3.32% i ...

The most recent trading session ended with Paycom Software (PAYC) standing at $191.34, reflecting a +0.93% shift from the previouse trading day's closing. The stock exceeded the S&P 500, which registered a gain of 0.89% for the day. On the other hand, the Dow registered a gain of 1.03%, and the technology-centric Nasdaq increased by 1.25%.Shares of the maker of human-resources and payroll software have depreciated by 0.25% over the course of the past month, underperforming the Computer and Technology sector ...

In the latest trading session, Paycom Software (PAYC) closed at $188.25, marking a +0.75% move from the previous day. The stock's change was more than the S&P 500's daily loss of 0.19%. Elsewhere, the Dow gained 0.1%, while the tech-heavy Nasdaq lost 0.54%.Heading into today, shares of the maker of human-resources and payroll software had lost 0.07% over the past month, lagging the Computer and Technology sector's gain of 2.36% and the S&P 500's gain of 3.18% in that time.The investment community will be pa ...