Core Viewpoint - Paycom Software has experienced a significant decline in stock value, down approximately 72% from its all-time high in November 2021, raising questions about whether this represents a broken story or a high-quality business undergoing a valuation reset, potentially presenting a buying opportunity [1] Group 1: Valuation Reset - Paycom specializes in payroll and human resources software, with a revenue base that is predominantly recurring, making the stock's drastic decline unexpected [3] - The high valuation in 2021 set a challenging growth expectation, and any signs of slowing growth prompted investors to reassess the stock's valuation [4] - Revenue growth has slowed significantly, with a 9.1% year-over-year increase in Q3 2025 compared to 30.4% growth in Q3 2021, indicating a dramatic deceleration [5] Group 2: Recent Performance - The third-quarter results for 2025 showed a sequential deceleration in growth, with 9.1% top-line growth down from 10.5% in Q2 [6] - Despite the deceleration, management projects approximately 9% total revenue growth for 2025, and share repurchases are becoming increasingly important to the investment thesis [8] Group 3: Profitability - Paycom's third-quarter growth of 9.1% is still considered solid, with recurring revenue growth at 10.6% year-over-year, representing about 95% of total revenue [9] - Profitability metrics are strong, with adjusted EBITDA margin increasing from 37.9% in the previous year to 39.4% in Q3 2025, and non-GAAP earnings per share rising 16.2% year-over-year to $1.94 [10]

Core Insights - The article discusses the importance of understanding the limitations of financial predictions and the inherent uncertainties involved in market analysis [2][3] Group 1 - Financial analysts provide median estimates for predictions and projections, which are subject to uncertainty [2] - The accuracy of price targets mentioned in the article is not guaranteed and should not be used as investment advice [2] - The past performance of investments does not guarantee future results, highlighting the unpredictable nature of the market [3]

Group 1 - Citi lowered the price target on Paycom (PAYC) to $185 from $191 while maintaining a Neutral rating on the shares [1] - The firm adjusted its models in the application software group after discussions with management [1] - Companies are experiencing a stable but uncertain demand environment, with some relief from the reopening of the U.S. government [1] Group 2 - Citi has named Pegasystems (PEGA) as its new top pick, highlighting the company's leadership in artificial intelligence monetization [1] - The firm also sees growth opportunities at Blackline (BL) and Workiva (WK) [1]

Core Insights - Paycom Software, Inc. has announced a multiyear partnership with NBA champion Jalen (JDub) Williams to promote its AI engine, IWant [1][2] - The campaign titled "Answers" will feature commercials across various platforms, debuting during nationally televised NBA games on Christmas Day [2][5] - Williams' positive energy and approachable personality are highlighted as key attributes that make him an ideal ambassador for Paycom [3] Campaign Details - The "Answers" campaign will be visible on TV, digital, social, and print platforms, showcasing Williams interacting with the IWant AI engine while performing everyday tasks [2][5] - This campaign follows a previous collaboration with actor James Marsden, who starred in the "Know It All" commercial, emphasizing the ease of using Paycom's technology [4] Company Overview - Paycom Software, Inc. specializes in cloud-based human capital management software, focusing on automated HR and payroll technology [7] - The company leverages AI and full-solution automation to streamline processes, providing a seamless experience for clients and their employees [7] - Paycom has been recognized for its innovative technology and workplace culture for over 25 years, serving businesses of all sizes in the U.S. and internationally [7]

Company Overview - Paycom Software, Inc. (PAYC) is a U.S.-based provider of cloud-based human capital management (HCM) solutions with a market cap of $9.4 billion, focusing on small to mid-sized businesses [1] - The company offers an integrated platform managing the entire employee life cycle, including recruitment, onboarding, payroll, benefits, and retirement [1][2] Stock Performance - Shares of Paycom have fallen 37.6% from their 52-week high of $267.76 and decreased 22.2% over the past three months, underperforming the S&P 500 Index, which gained 1.8% in the same period [3] - Year-to-date, PAYC stock is down 18.5%, while the S&P 500 has risen by 14.3% [4] - Over the past 52 weeks, Paycom shares have dropped 28.3%, contrasting with the S&P 500's return of 11.1% [4] Financial Performance - In Q3 2025, Paycom reported revenue of $493.3 million, exceeding expectations, but shares fell 10.7% the following day due to an adjusted EPS of $1.94 that missed estimates [5] - There was a significant decline in cash and cash equivalents, dropping to $375 million from $532.2 million in the prior quarter [5] Analyst Sentiment - Despite the stock's weak performance, analysts maintain a moderately optimistic outlook with a consensus rating of "Moderate Buy" from 21 analysts [6] - The mean price target for PAYC is $209.12, indicating a potential upside of 25.2% from current levels [6]

Core Points - Caleb Downs from Ohio State University has been awarded the 2025 Paycom Jim Thorpe Award, recognizing him as the top defensive back in college football based on performance, athletic ability, and character [1] Group 1 - The award was announced during The Home Depot College Football Awards on ESPN [1] - The Paycom Jim Thorpe Award is presented by the Oklahoma Sports Hall of Fame and the Jim Thorpe Association [1]

Group 1 - The article does not provide any specific content related to a company or industry [1]

Summary of Paycom Conference Call Company Overview - **Company**: Paycom - **Industry**: Human Capital Management (HCM) Software Key Points and Arguments Performance and Strategy - Paycom reported a successful year with a focus on world-class service, client value achievement, and full-solution automation [1][2] - Client satisfaction levels have improved significantly, indicating successful service enhancements [5][6] - The company has seen a recurring revenue growth of 10% and an Adjusted EBITDA of 43% [11] Market Position and Opportunities - Paycom currently captures only 5% of the total addressable market, indicating substantial growth potential [9] - The company plans to double down on sales efforts and open several new offices in the next two to three years [11][69] - There is a strong emphasis on increasing sales capacity and improving client retention through enhanced service and product offerings [15][36] Product Development and Innovation - The introduction of the "I-Want" feature has streamlined user interaction, allowing employees to access services without extensive training [20][21] - Automation of routine decisions, such as time-off requests, has been highlighted as a significant value-add for clients, reducing management burden [29][30] - Paycom's focus on decision logic and automation is expected to drive further efficiencies for clients, enhancing overall satisfaction and retention [34][39] Competitive Landscape - Paycom believes its competitive advantage lies in its unique product offerings and the ability to automate processes effectively, which competitors struggle to replicate [40][42] - The company is not overly concerned about macroeconomic factors impacting its growth strategy, focusing instead on internal capabilities and market opportunities [11][47] Future Outlook - Paycom is optimistic about its growth trajectory into 2026, with plans to enhance sales strategies and expand market presence [16][68] - The company is committed to maintaining strong margins while pursuing growth, ensuring that increased sales do not negatively impact profitability [69] AI and Technology Integration - Paycom manages its own data centers and is exploring AI applications to enhance product efficiency and client service [57][58] - The company is cautious about AI implementation, ensuring it adds value without complicating user experience [60][61] Additional Important Insights - Paycom has seen a trend of clients returning after experiencing higher total costs with competitors, emphasizing the value of its automation capabilities [5] - The company is focused on aligning its sales and marketing efforts to better communicate the value proposition to clients [45][50] - There is a recognition of the need for continuous improvement in internal processes to maximize client value and satisfaction [66][67]

Core Viewpoint - Paycom Software reported lower-than-expected Q3 2025 earnings, with revenues increasing year-over-year but missing earnings estimates, leading to questions about future performance [3][4][10]. Financial Performance - Paycom reported non-GAAP earnings of $1.94 per share, missing the Zacks Consensus Estimate of $1.96, but showing a 16.2% increase year-over-year [3]. - Revenues reached $493.3 million, exceeding the consensus mark of $492.4 million, and reflecting a 9.1% year-over-year growth driven by sales momentum, international expansion, and AI integration [4]. - Recurring revenues, which constitute 94.6% of total revenues, improved by 10.6% to $466.5 million, surpassing estimates [5]. - Adjusted gross profits increased by 11.9% to $411.3 million, with an adjusted gross margin expanding by 210 basis points to 83.4% [6]. Cash Flow and Balance Sheet - As of September 30, 2025, Paycom had cash and cash equivalents of $375 million, down from $532.2 million in the previous quarter, and no debt [7]. - In Q3, the company generated operating cash flow of approximately $177.8 million, paid out $21.1 million in dividends, and repurchased $223.4 million of its common stock [8]. Guidance and Estimates - Paycom reiterated its revenue guidance for 2025, forecasting revenues between $2.045 billion and $2.055 billion, with recurring revenues expected to grow by 10% year-over-year [10]. - The company anticipates adjusted EBITDA between $872 million and $882 million, indicating an EBITDA margin of approximately 43% at the midpoint [10]. - Recent estimates have shown a downward trend, with a Zacks Rank of 3 (Hold) indicating expectations for an in-line return in the coming months [11][13]. Industry Context - Paycom operates within the Zacks Internet - Software industry, where competitor Pinterest reported revenues of $1.05 billion for the last quarter, reflecting a year-over-year increase of 16.8% [14].

Core Points - The Oklahoma Sports Hall of Fame and Jim Thorpe Association announced the finalists for the 2025 Paycom Jim Thorpe Award, recognizing the top three defensive backs in college football based on performance, athletic ability, and character [1][2] Group 1: Finalists Overview - The finalists for the 2025 Paycom Jim Thorpe Award are Mansoor Delane from LSU, Caleb Downs from Ohio State, and Leonard Moore from Notre Dame, representing the SEC, Big Ten, and an independent university respectively [2] - Mansoor Delane achieved a PFF Defensive Coverage Grade of 90.9, totaling 40 tackles, 10 passes defended, 2 interceptions, and 9 pass breakups while playing through an injury [3] - Caleb Downs earned an 88.5 PFF Defensive Coverage Grade, with 49 tackles, 1 sack, 2 interceptions, and 1 pass breakup, and is recognized for his leadership and community involvement [4] - Leonard Moore recorded a PFF Defensive Coverage Grade of 91.4, with 26 tackles, 4 interceptions, and 1 forced fumble, demonstrating exceptional playmaking ability and leadership qualities [5] Group 2: Award Selection and Voting - The award recipient will be selected by the Paycom Jim Thorpe Award National Selection Committee, which includes members from the Oklahoma Sports Hall of Fame, former award recipients, and sports journalists [6] - A fan vote will take place for the eighth consecutive season, allowing fans to participate in the selection process, with voting opening on November 25 and closing on December 5 [7] Group 3: Award Significance and History - The Paycom Jim Thorpe Award is part of the National College Football Awards Association, which has honored over 950 recipients since its establishment in 1935 [8] - The award is named after Jim Thorpe, a legendary athlete known for his exceptional performance in multiple sports, including football, baseball, and the Olympics [11]