Paycom Software (PAYC): BMO Capital Highlights Contraction in Broader Software Multiples

Core Viewpoint - Paycom Software, Inc. (NYSE:PAYC) is recognized as a strong long-term tech investment, despite recent price target reductions by various analysts due to broader software multiple contractions [1][2][4]. Price Target Adjustments - BMO Capital has lowered its price target for Paycom from $190.00 to $175.00 while maintaining a "Market Perform" rating, citing broader software multiple contractions as the reason [1]. - TD Cowen analyst Jared Levine has reduced the price target from $200 to $184 but retains a "Buy" rating, reflecting updated estimates based on the latest Fed Funds rate expectations [3]. - Citi has also adjusted its price target from $191 to $185 while keeping a "Neutral" rating, following discussions with company management [4]. Revenue Growth Potential - Analysts suggest that the risk of further multiple compression may be mitigated if Paycom can maintain double-digit recurring revenue growth, excluding float [2]. Company Overview - Paycom Software, Inc. provides a cloud-based human capital management (HCM) solution delivered as software-as-a-service, targeting small to mid-sized companies [4].