Paycom Software Processes Another Beat and Raise
Management boosts full-year guidance yet again in response to another solid quarter.
Brian Feroldi (TMFTypeoh)
Aug 1, 2018 at 7:20PM
Paycom Software (NYSE:PAYC) reported second-quarter results on Tuesday, and they showed that sales growth accelerated modestly during the period to 31%, which easily exceeded the high end of managements guidance range. At the same time, expense growth continued to trail sales growth, which enabled magnified gains on the bottom line. When coupled with stock buybacks, non-GAAP earnings per share jumped 69% in the period.
What happened with Paycom this quarter
Sales growth of 31% represented a sequential acceleration and was comfortably above the top end of guidance.
Increased scale led to margin expansion across the income statement.
Stock buybacks totaled more than 400,000 shares during the quarter. This repurchase activity caused the company's diluted share count to decline slightly year over year.
Two new sales offices were opened during the period. There are now 49 sales office teams.
What management had to say
Paycom CEO and founder Chad Richison kept his commentary focused on the company's strong results: "Paycom continued its momentum, driving strong revenue and profits while also returning solid value to our stockholders with the repurchase of more than 400,000 shares in the second quarter. ... We expanded our sales reach by opening two new offices and also completed construction of a fourth building at our campus headquarters in Oklahoma City."
On the conference call with investors, Richison reaffirmed his belief that the company's human capital management (HCM) software remains in a great competitive position: "We believe our offering remains the best option in the marketplace. We also believe that we are still at the beginning of an HCM transformation through which employers experience greater return on their investment by leveraging HCM technology for their employees."
Paycom Software Processes Another Beat and Raise -- The Motley Fool