HCM Leader Paycom Continues To Outperform, Impresses Analysts

Oklahoma-based Paycom is streamlining the human capital management process for enterprises, and its efforts are paying off in a big way. In its recently released full-year results report, the cloud firm surged past the Street's expectations by $3 million with a reported $193.4 million in Q4 revenues, up 29 percent from the previous year.

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Analysists also forecasted 68 cents EPS while the results revealed a much happier earnings-per-share-ending at 78 cents for the HR provider. This trend shows an impressive 44 percent increase over the previous year, and CEO Chad Richison doesn't believe it's slowing down anytime soon. "Based on the strong momentum we are seeing, we believe we are well-positioned to deliver an enviable combination of high revenue growth and high margins for years to come," he said. Net income also bumped up to $45.4 million in this fourth quarter, which compares favorably to $31.4 million from the same time last year.

With a market cap at close to $19.5 billion, it is the third-largest publicly traded company in the state. The stock has almost doubled in the last year, and this was due to a few contributing factors. The firm, for example, was added to the Standard & Poor 5oo Index in late January. The stock rose 20 percent as index funds bought into the newest piece of the S&P pie and sent share prices upwards. Additionally, the recent results reports have analysts revising their predictions for revenues at $913.6 million for 2020. The new numbers have created a greater sense of optimism for Paycom's financial future, and consensus values the stock at $307 per share.

Founded in 1998, Paycom was one of the first companies to offer a "pay-as-you-go" model. Now, it is a cloud-based payroll and human management provider to thousands of companies within the United States. Even with the growth and change, Paycom still believes people are at the center of everything. They practice this belief in both small and large ways: a tech specialist is assigned to each customer, so there is always continuity of care.

The firm is continually evolving and added several new products to its suite in recent years, including the Direct Data Exchange and Ask Here. They also released their Manager-on-the-Go, which is a tool that works with the Paycon mobile app that enables administrators the ability to perform certain kinds of tasks remotely – like time-off requests, time cards, and schedule oversight, and expense reimbursement approval.

"We strengthened our position in the human capital management industry with new product innovations, unparalleled service, and an unrelenting focus on adding value for our clients," Richison said. “Our differentiated product strategy is driving rapid revenue growth, and high employee usage is driving higher annual revenue retention.”