Paycom $PAYC one of the few bright spots in the Tech Sector
With CEO Chad Richison owning roughly 14% of the company, Paycom $PAYC is one of the few listed tech companies where insiders still hold a significant shareholding.
Paycom, based in Oklahoma City, redefines the human capital management industry by enabling businesses to effectively navigate a rapidly changing business environment. Its cloud-based software solution is based on a core system of record for all human capital management functions, which is maintained in a single database, and provides the functionality that businesses require to manage the entire employment lifecycle, from recruitment to retirement. Paycom can serve businesses of all sizes and in all industries. Paycom, one of the leading human capital management providers, serves clients in all 50 states from offices located throughout the country.
In a nutshell, Paycom provides a set of finance and HR software solutions that companies use to hire, evaluate, train and pay their workforce.
Numbers don't lie
- Revenue has increased 86% over the last 3 years to $1.15 billion
- Gross margins of close to 85% (84.7%)
- 5-year average EPS growth 25.66%
- Profit margin 20%
It's certainly not the fastest-growing tech stock, with an average annual revenue growth rate of 26.2% but it's profitable with healthy profit margins of 20% and a clearly identified core problem it is solving. Paycom has invested heavily in it's cloud-based tools over the years, and that is evidenced by the number of clients now using their product, up from 23,500 in 2018 to 33,875 in 2021. Keeping in mind that each one of these clients represents a sizable company with many employees, Paycom targets businesses with 5,000 to 10,000 employees.