Fundamental Analysis
About Paycom
Passionate about providing employers easy access to their payroll data, Paycom launched in 1998. Since day one Paycom has been committed to the ongoing development of a single application that lowers labor costs, drives employee engagement and reduces exposure.
Reasons to buy – Paycom Software
High level decisions on buy or sell for a stock should be driven by
1. The margin that the company makes. i.e. Out of $1 that the company sells how much does the company taken home.
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- Here we see Paycom Software makes a margin of 33% on Gross Level and about 27% on Net level. This means that out of $1 that it makes $0.35 is being pocketed as profits. This is among the best margins across a ton of companies.
2. The growth rates of the company on revenue, net income, EPS and Dividend. i.e. If it sold $1 last year how much more did it sell this year.
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- Here we see net revenue growth of 28% in the revenue and the net profit figures grew by 22%.
3. The efficiency ratios of the company on Equity and Assets. i.e. How well is the company able to sweat each $1 that it puts to work in the company.
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- Here we see Paycom Software makes a Return on Assets of 10% and Return of Equity of 49% which is pretty good. Even the Debt/Equity ratio is great.
Although you would notice very less chatter on the media on this stock you can be sure that the last 3 month/one year returns on this stock are amazing.
GOLD STANDARD : This is one of the no-debate stocks that are a must have in ones portfolio.
All these ratios can be found in the attached excel sheets and are based on the EDGAR report submitted by Paycom Software to the SEC. All the data on the above analysis can be found at the link below
Balance Sheet
Income Statement
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