Paylocity (NASDAQ:PCTY – Get Free Report) posted its quarterly earnings results on Thursday. The software maker reported $2.09 earnings per share (EPS) for the quarter, topping the consensus estimate of $1.93 by $0.16, FiscalAI reports. The firm had revenue of $451.67 million during the quarter, compared to analyst estimates of $443.12 million. Paylocity had a net margin of 15.23% and a return on equity of 27.02%. The company’s quarterly revenue was up 10.7% compared to the same quarter last year. During the same quarter in the prior year, the business posted $1.75 earnings per share.
Here are the key takeaways from Paylocity’s conference call:
- Paylocity reported Q1 recurring and other revenue of $424.5 million, up 12%, and total revenue of $451.7 million, up nearly 11%, beating its guidance. Adjusted EBITDA was $159.5 million, a 35.3% margin, also above expectations.
- The company raised fiscal 2027 guidance, increasing its total revenue outlook by $30 million at the midpoint to $1.910 billion–$1.925 billion and adjusted EBITDA guidance to $711.5 million–$721.5 million. The outlook assumes no further interest-rate changes this fiscal year and includes an estimated $118 million in interest income on client funds.
- Management highlighted growing AI adoption and monetization opportunities: Ignite AI has answered nearly 30 million questions and surfaced more than 3 billion recommendations, while Recruiting Optimizer is offered as a premium solution. The company cited early customer results including 35% higher recruiting productivity and roles filled 25% faster.
- Management described demand as stable and Q1 growth as balanced across new customers, ARPU, product sales into the existing base, and client retention; referral partners generated more than 25% of new business. It also repurchased 1.1 million shares for $152.5 million and said it expects to remain active under its buyback program.
- Gross margin declined year over year, which management attributed to timing and staffing for newer offerings, rather than AI-related costs. It expects margins to improve through the year, while total R&D investment rose nearly 15% year over year to support product development.
Paylocity Stock Performance
NASDAQ PCTY traded up $3.58 on Friday, hitting $173.15. 1,225,928 shares of the stock were exchanged, compared to its average volume of 596,017. The company has a market capitalization of $9.03 billion, a PE ratio of 30.49, a P/E/G ratio of 2.06 and a beta of 0.43. The company has a debt-to-equity ratio of 0.07, a current ratio of 1.09 and a quick ratio of 1.09. The business’s fifty day moving average is $156.11 and its 200 day moving average is $127.44. Paylocity has a 52 week low of $92.99 and a 52 week high of $180.88.
Insider Buying and Selling
In other news, Chairman Steven R. Beauchamp sold 15,000 shares of the firm’s stock in a transaction dated Thursday, October 15th. The shares were sold at an average price of $165.22, for a total transaction of $2,478,300.00. Following the completion of the sale, the chairman owned 1,243,389 shares in the company, valued at approximately $205,432,730.58. This trade represents a 1.19% decrease in their position. The transaction was disclosed in a filing with the SEC, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Steven Sarowitz sold 19,459 shares of the business’s stock in a transaction that occurred on Thursday, August 27th. The stock was sold at an average price of $157.78, for a total value of $3,070,241.02. Following the sale, the director owned 4,453,495 shares of the company’s stock, valued at approximately $702,672,441.10. This represents a 0.44% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last three months, insiders have sold 151,704 shares of company stock worth $25,137,741. Company insiders own 19.40% of the company’s stock.
Key Paylocity News
Here are the key news stories impacting Paylocity this week:
- Positive Sentiment: For Q1 fiscal 2027, Paylocity reported adjusted earnings of $2.09 per share, versus the $1.93 consensus, and revenue of $451.7 million, above the $443.1 million estimate. Revenue increased 10.7% year over year, while recurring and other revenue rose 12%. The company’s full-year outlook slightly exceeded expectations. Paylocity Announces First Quarter Fiscal 2027 Financial Results
- Positive Sentiment: Analyst target increases added to the upbeat tone: Citizens JMP raised its target to $200 and kept a market outperform rating; Truist raised its target to $200 and maintained Buy; and BTIG lifted its target to $210 and reiterated Buy. Citizens JMP recommendations Truist target change BTIG Research recommendations
- Positive Sentiment: Paylocity repurchased $152.5 million of shares during the quarter, continuing a buyback program that may support per-share results. It also completed the acquisition of Aidora to expand AI-powered leave-management capabilities. Quarterly results release
- Neutral Sentiment: Barclays raised its price target to $176 but maintained an Equal Weight rating, signaling a more cautious view than the other target revisions. Barclays recommendations
Analysts Set New Price Targets
Several analysts have recently commented on the stock. Jefferies Financial Group reissued a “buy” rating and set a $165.00 price target on shares of Paylocity in a research note on Wednesday, August 5th. Cantor Fitzgerald upped their price target on Paylocity from $165.00 to $200.00 and gave the company an “overweight” rating in a research note on Friday, October 30th. TD Cowen upped their price target on Paylocity from $168.00 to $177.00 and gave the company a “buy” rating in a research note on Thursday, August 20th. Citigroup raised their price target on Paylocity from $168.00 to $208.00 and gave the company a “buy” rating in a report on Tuesday, October 27th. Finally, Wall Street Zen lowered Paylocity from a “buy” rating to a “hold” rating in a research report on Saturday, October 24th. Twelve research analysts have rated the stock with a Buy rating and five have issued a Hold rating to the company’s stock. Based on data from MarketBeat.com, Paylocity currently has a consensus rating of “Moderate Buy” and a consensus target price of $177.47.
Read Our Latest Research Report on PCTY
About Paylocity
Paylocity Holding Corporation (NASDAQ:PCTY) provides cloud-based human capital management (HCM) and payroll software for organizations. Its platform is designed to help employers manage payroll, human resources, employee benefits, talent acquisition, onboarding, performance, learning, and workforce administration through an integrated system.
The company also offers tools for time and labor management, scheduling, employee communications, engagement, surveys, expense management, and other workplace activities.
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