- Paycom Software (PAYC) exhibits strong price momentum.
- Shares are up more than 40% over the past year.
- PAYC maintains a 100% “Buy” technical opinion from Barchart.
- Many analysts are bullish, but some do warn that PAYC is overvalued. I recommend a cautious stop loss.
Today’s Featured Stock
Valued at $12.1 billion, Paycom Software (PAYC) is a provider of cloud-based human capital management software for both employee records and talent management processes.
What I’m Watching
I found today’s Chart of the Day by using Barchart’s powerful screening functions to sort for stocks with the highest technical buy signals and superior current momentum. I then used Barchart’s Flipcharts feature to review the charts for consistent price appreciation. PAYC checks those boxes. The Trend Seeker issued a new “Buy” signal on Sept. 15. Since that signal, PAYC is up 7.01%.
Barchart’s Technical Indicators for Paycom Software
Editor’s Note: The technical indicators below are updated live during the session every 20 minutes and can therefore change each day as the market fluctuates. The indicator numbers shown below therefore may not match what you see live on the Barchart.com website when you read this report. These technical indicators form the Barchart Opinion on a particular stock.
Paycom Software hit a 3-year high of $275.22 October 23.
- Paycom has a Weighted Alpha of 81.39.
- PAYC has a 100% “Buy” opinion from Barchart.
- The stock has gained 43.74% over the past 52 weeks.
- Paycom has its Trend Seeker “Buy” signal intact.
- The stock recently traded at $256.01 with a 50-day moving average of $238.33.
- PAYC had 12 highs and gained 16.96% in the last month.
- 60-month beta of 0.75.
- Relative Strength Index (RSI) is at 50.54.
- There’s a technical support level around $264.64.
Don’t Forget the Fundamentals
- $12.1 billion market capitalization.
- 30.33x trailing price-earnings ratio.
- 0.57% dividend yield.
- Revenue is expected to grow 7.67% this year and another 7.46% next year.
- Earnings are estimated to increase 30.92% this year and an additional 15.36% next year.
Analyst and Investor Sentiment on Paycom Software
- Wall Street analysts followed by Barchart give the stock 6 “Strong Buy,” 14 “Hold” and 1 “Moderate Sell” opinion with price targets from $160 to $305.
- Value Line rates the stock “Highest” with price targets between $205 and $305.
- Morningstar thinks the stock is 54% overvalued with a fair value of $170.
- 30,320 investors are following the stock on Seeking Alpha, which rates it a “Hold.”
- TipRanks’ analysts have a consensus price target of $251.66.
- Short interest is 5.50% of the float with 4.50 days to cover.
The Bottom Line on Paycom Software
The company shows strong profitability and recent stock momentum, backed by positive analyst revisions. Morningstar seems to have a real problem with the stock’s valuation. Place a cautious stop loss just in case they are right.
Additional disclosure: The Barchart Chart of the Day highlights stocks that are experiencing exceptional current price appreciation. They are not intended to be buy recommendations as these stocks are extremely volatile and speculative. Should you decide to add one of these stocks to your investment portfolio, it is highly suggested you follow a predetermined diversification and moving stop loss discipline that is consistent with your personal investment risk tolerance.
On the date of publication, Jim Van Meerten did not directly have a position in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.