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Paycom (PAYC) to Post Q2 Earnings: What's in the Cards?

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Paycom Software (PAYC - Free Report) is scheduled to report second-quarter 2022 results on Aug 2.

The company’s management projects revenues between $308 million and $310 million for the second quarter. The Zacks Consensus Estimate for revenues is pegged at $309.2 million, indicating an increase of 27.7% year over year. The consensus mark for earnings stands at $1.12 per share, suggesting a 15.5% rise from the prior-year quarter.

Paycom estimates adjusted EBITDA in the range of $111 million to $113 million in the quarter to be reported. The company’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 7.2%.

Paycom Software, Inc. Price and EPS Surprise Paycom Software, Inc. Price and EPS Surprise

Paycom Software, Inc. price-eps-surprise | Paycom Software, Inc. Quote

Factors to Note

Paycom’s second-quarter performance is likely to have benefited from strong demand for the latest products, new business wins and the high-margin recurring revenue business. The company’s employee usage strategy, sales efforts and investments might have contributed to sales growth in the quarter to be reported.

The cloud-based human capital management solution provider continues to expect strong adoption of BETI solution, an industry-first technology that empowers employees to do their own payroll among its clients, aiding them in avoiding time-consuming manual checks. We anticipate new client additions to have driven the top line in the second quarter.

However, Paycom’s quarterly performance is expected to have been hurt by pandemic-triggered economic and business disruptions, which might have hurt the headcount across its client base.

What Our Model Unveils

Our proven model does not conclusively predict an earnings beat for PAYC this season. The combination of a positive Earnings ESP and Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. However, that’s not the case here.

Paycom currently has a Zacks Rank of #3 and an Earnings ESP of 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks With Favorable Combination

Per our model, MRC Global (MRC - Free Report) , Alcon (ALC - Free Report) and Grocery Outlet (GO - Free Report) have the right combination of elements to post an earnings beat in their upcoming releases.

MRC Global is slated to report second-quarter 2022 results on Aug 8. The company has a Zacks Rank #1 and an Earnings ESP of +30.27% at present. COP's earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 140.8%. You can see the complete list of today's Zacks #1 Rank stocks here.

MRC’s Zacks Consensus Estimate for quarterly earnings is pegged at 25 cents per share, suggesting a whopping year-over-year surge of 212.5%. Its quarterly revenues are estimated to increase 23.4% year over year to $846.5 million.

Alcon has a Zacks Rank #1 and an Earnings ESP of +5.07%. The company is scheduled to report second-quarter 2022 results on Aug 16. ALC's earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 21.4%.

In the second quarter, Alcon’s Zacks Consensus Estimate for earnings is pegged at 55 cents per share, indicating a 1.8% year-over-year decline. However, revenue is expected to grow 4.4% to $2.19 billion.

Grocery Outlet, which has an Earnings ESP of +5.62%, flaunts a Zacks Rank #1. The company is slated to report its second-quarter 2022 results on Aug 9. Its earnings beat the Zacks Consensus Estimate in each of the preceding four quarters, the average surprise being 4.8%.

The Zacks Consensus Estimate for GO’s second-quarter earnings stands at 24 cents per share, suggesting a year-over-year increase of 4.4%. GO anticipates revenues of $859.6 million, which suggests growth of 10.8% from the year-ago quarter.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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