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Paycom (PAYC) Q1 Earnings and Revenues Surpass Estimates
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Paycom Software (PAYC - Free Report) 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. The top line climbed 10.7% year over year. The top-line figure also surpassed management’s guidance of $494-$497 million, primarily driven by new logo wins.
Paycom Software, Inc. Price, Consensus and EPS Surprise
Paycom’s Recurring revenues (representing 98.4% of the total revenues) improved 9.7% to $491.9 million in the first quarter. Our estimate for the company’s Recurring revenues was pegged at $488.4 million.
The company’s revenues from the Implementation and Other segment improved to $7.98 million from $7.2 million in the year-ago quarter and contributed 1.6% to total sales. Our estimate for the segment’s revenues was pegged at $7.7 million.
Adjusted gross profits climbed 9.12% from the year-ago period to $424.2 million. However, the adjusted gross margin contracted 120 basis points (bps) on a year-over-year basis to 84.9%.
Paycom’s adjusted EBITDA increased 4.1% year over year to $229.5 million. The adjusted EBITDA margin contracted 290 bps to 45.9%.
Balance Sheet & Cash Flow
Paycom exited the first quarter with cash and cash equivalents of $371.3 million compared with $294 million recorded in the previous quarter. The company had no debt as of Mar 31, 2024, as it paid off all its long-term debt at the end of 2023.
In the first quarter of 2024, PAYC generated an operating cash flow of approximately $148.6 million, paid out $21.2 million in dividends and bought back $3.1 million worth of its common stock.
The company had $796 million remaining under its buyback authorization as of Mar 31, 2024. Paycom’s board has approved its upcoming quarterly dividend of 37.5 cents per share, payable in the middle of June 2024.
Guidance
For the second quarter of 2024, Paycom forecasts revenues in the range of $434-$438 million and expects adjusted EBITDA between $151 million and $155 million.
For 2024, PAYC forecasts revenues in the band of $1.860-$1.885 billion and expects adjusted EBITDA between $720 million and $730 million.
Zacks Rank and Stocks to Consider
Currently, Paycom carries a Zacks Rank #3 (Hold). Shares of the company have plunged 36.6% in the past year.
The Zacks Consensus Estimate for ANET's 2024 earnings per share has been revised upward by 3 cents to $7.49 in the past 30 days. Shares of the company have rallied 64.7% in the past year.
The Zacks Consensus Estimate for CXDO’s 2024 earnings per share has been revised upward by 6 cents to 23 cents in the past 60 days. Shares of the company have skyrocketed 202.2% in the past year.
The Zacks Consensus Estimate for DELL’s 2024 earnings per share has been revised upward by 17 cents to $7.64 in the past 60 days. Shares of the company have surged 191.4% in the past year.
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Paycom (PAYC) Q1 Earnings and Revenues Surpass Estimates
Paycom Software (PAYC - Free Report) 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. The top line climbed 10.7% year over year. The top-line figure also surpassed management’s guidance of $494-$497 million, primarily driven by new logo wins.
Paycom Software, Inc. Price, Consensus and EPS Surprise
Paycom Software, Inc. price-consensus-eps-surprise-chart | Paycom Software, Inc. Quote
Quarter in Detail
Paycom’s Recurring revenues (representing 98.4% of the total revenues) improved 9.7% to $491.9 million in the first quarter. Our estimate for the company’s Recurring revenues was pegged at $488.4 million.
The company’s revenues from the Implementation and Other segment improved to $7.98 million from $7.2 million in the year-ago quarter and contributed 1.6% to total sales. Our estimate for the segment’s revenues was pegged at $7.7 million.
Adjusted gross profits climbed 9.12% from the year-ago period to $424.2 million. However, the adjusted gross margin contracted 120 basis points (bps) on a year-over-year basis to 84.9%.
Paycom’s adjusted EBITDA increased 4.1% year over year to $229.5 million. The adjusted EBITDA margin contracted 290 bps to 45.9%.
Balance Sheet & Cash Flow
Paycom exited the first quarter with cash and cash equivalents of $371.3 million compared with $294 million recorded in the previous quarter. The company had no debt as of Mar 31, 2024, as it paid off all its long-term debt at the end of 2023.
In the first quarter of 2024, PAYC generated an operating cash flow of approximately $148.6 million, paid out $21.2 million in dividends and bought back $3.1 million worth of its common stock.
The company had $796 million remaining under its buyback authorization as of Mar 31, 2024. Paycom’s board has approved its upcoming quarterly dividend of 37.5 cents per share, payable in the middle of June 2024.
Guidance
For the second quarter of 2024, Paycom forecasts revenues in the range of $434-$438 million and expects adjusted EBITDA between $151 million and $155 million.
For 2024, PAYC forecasts revenues in the band of $1.860-$1.885 billion and expects adjusted EBITDA between $720 million and $730 million.
Zacks Rank and Stocks to Consider
Currently, Paycom carries a Zacks Rank #3 (Hold). Shares of the company have plunged 36.6% in the past year.
Some better-ranked stocks from the broader technology sector are Arista Networks (ANET - Free Report) , Crexendo (CXDO - Free Report) and Dell Technologies (DELL - Free Report) . While ANET and CXDO sport a Zacks Rank #1 (Strong Buy) each, DELL carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for ANET's 2024 earnings per share has been revised upward by 3 cents to $7.49 in the past 30 days. Shares of the company have rallied 64.7% in the past year.
The Zacks Consensus Estimate for CXDO’s 2024 earnings per share has been revised upward by 6 cents to 23 cents in the past 60 days. Shares of the company have skyrocketed 202.2% in the past year.
The Zacks Consensus Estimate for DELL’s 2024 earnings per share has been revised upward by 17 cents to $7.64 in the past 60 days. Shares of the company have surged 191.4% in the past year.