Paycom Software (NYSE:PAYC) Issues Quarterly Earnings Results, Beats Expectations By $0.56 EPS

Paycom Software (NYSE:PAYC) posted its quarterly earnings results on Wednesday. The software maker reported $3.37 earnings per share (EPS) for the quarter, beating the consensus estimate of $2.81 by $0.56, FiscalAI reports. Paycom Software had a net margin of 22.78% and a return on equity of 37.06%. The company had revenue of $543.80 million for the quarter, compared to analyst estimates of $535.26 million. During the same quarter in the previous year, the firm posted $1.94 earnings per share. The company’s quarterly revenue was up 10.2% compared to the same quarter last year.

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

• Paycom beat expectations in Q3: Revenue rose 10% year over year to $544 million, while non-GAAP diluted EPS increased 74% to $3.37. Adjusted EBITDA was $268 million, a 49.3% margin.
• The company raised its 2026 outlook for revenue to $2.213 billion–$2.218 billion and Adjusted EBITDA to $1.069 billion–$1.079 billion, implying an EBITDA margin of 48.5% at the midpoint.
• Management highlighted growing demand for automation and AI: IWant usage is up about 65% since year-end 2025, and the company said its AI features carry no incremental client cost. Asset Management, a newer product designed to help clients control asset spending, has more than 300 clients.
• Management expects further efficiency and product opportunities: It cited automation and owned data-center infrastructure as drivers of productivity and margins, and said free cash flow should be stronger in 2027. Executives also described a robust product pipeline and increased sales and marketing focus for next year.

Paycom Software Price Performance

Shares of NYSE PAYC traded down $18.27 during mid-day trading on Thursday, reaching $249.89. 1,702,289 shares of the company were exchanged, compared to its average volume of 1,160,496. Paycom Software has a 52 week low of $104.90 and a 52 week high of $275.22. The company has a quick ratio of 1.07, a current ratio of 1.07 and a debt-to-equity ratio of 1.57. The stock has a market capitalization of $11.26 billion, a PE ratio of 26.56, a PEG ratio of 1.41 and a beta of 0.75. The company’s 50 day moving average price is $237.97 and its 200 day moving average price is $165.78.

Paycom Software Announces Dividend

The business also recently disclosed a quarterly dividend, which will be paid on Monday, December 7th. Stockholders of record on Monday, November 23rd will be issued a dividend of $0.3750 per share. This represents a $1.50 dividend on an annualized basis and a dividend yield of 0.6%. The ex-dividend date of this dividend is Monday, November 23rd. Paycom Software’s payout ratio is currently 15.94%.

Insider Buying and Selling

In related news, insider Shane Hadlock sold 2,577 shares of the stock in a transaction on Thursday, August 27th. The stock was sold at an average price of $237.60, for a total value of $612,295.20. Following the transaction, the insider owned 70,152 shares of the company’s stock, valued at $16,668,115.20. This represents a 3.54% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website. 13.20% of the stock is currently owned by corporate insiders.

Key Headlines Impacting Paycom Software

Here are the key news stories impacting Paycom Software this week:

• Positive Sentiment: Q3 adjusted earnings of $3.37 per share beat estimates, while revenue rose 10.2% year over year to $543.8 million. Earnings also benefited from revenue growth, automation adoption and improved margins. Paycom Q3 Earnings Beat Estimates on Revenue Growth, Margin Gains
• Positive Sentiment: Management raised its 2026 revenue and EBITDA guidance, signaling confidence in continued growth. Paycom Software Beats and Lifts Guidance
• Positive Sentiment: KeyCorp raised its price target to $297 and maintained an “overweight” rating. Paycom also announced its first cash dividend. KeyCorp recommendations Paycom declares first cash dividend
• Negative Sentiment: BTIG Research downgraded PAYC from “buy” to “neutral.” Other coverage raised questions about valuation, with one article noting the shares may be richly valued even after the guidance increase. These concerns may help explain the weak reaction despite the earnings beat. Paycom stock could be rich despite raised revenue guidance

Analyst Ratings Changes

A number of analysts recently issued reports on the company. BTIG Research cut Paycom Software from a “buy” rating to a “neutral” rating in a report on Thursday. TD Cowen boosted their price target on shares of Paycom Software from $244.00 to $286.00 and gave the company a “buy” rating in a research report on Friday, October 2nd. Weiss Ratings raised shares of Paycom Software from a “hold (c)” rating to a “hold (c+)” rating in a report on Thursday, October 8th. Zacks Research cut shares of Paycom Software from a “strong-buy” rating to a “hold” rating in a report on Monday, October 5th. Finally, Stifel Nicolaus increased their price objective on Paycom Software from $120.00 to $200.00 and gave the stock a “hold” rating in a research report on Thursday, August 6th. Four investment analysts have rated the stock with a Buy rating, twelve have issued a Hold rating and one has assigned a Sell rating to the company. Based on data from MarketBeat, the stock presently has a consensus rating of “Hold” and an average target price of $256.36.

About Paycom Software

Paycom Software, Inc is a provider of cloud-based human capital management (HCM) software designed to help businesses manage employee-related processes through a unified platform. Its solutions support payroll, human resources, talent acquisition and management, time and labor management, compliance, and employee engagement.

The company’s software is intended to allow employers and employees to enter and manage workforce information within a single system. Its offerings include payroll processing, benefits administration, expense management, scheduling, performance management, learning, and recruiting tools.