Paylocity (NASDAQ:PCTY) Stock Rating Cut to Hold at Wall Street Zen

Key Points

• Wall Street Zen downgraded Paylocity from “Buy” to “Hold,” although broader analyst sentiment remains positive, with a “Moderate Buy” consensus rating and an average price target of $166.71.
• Paylocity reported a quarterly earnings and revenue beat, posting $1.84 in EPS versus $1.62 expected and $444.73 million in revenue versus $431.46 million forecast; revenue rose 11% year over year.
• Insiders sold approximately $19.2 million of stock in the latest quarter, while institutional ownership remained high at 94.76%; the shares were trading near their 52-week high.

Paylocity (NASDAQ:PCTY - Get Free Report) was downgraded by Wall Street Zen from a "buy" rating to a "hold" rating in a research note issued on Saturday, Wall Street Zen reports.

Several other brokerages have also commented on PCTY. KeyCorp raised their price target on Paylocity from $172.00 to $178.00 and gave the company an "overweight" rating in a research note on Wednesday, August 5th. Jefferies Financial Group reiterated a "buy" rating and issued a $165.00 target price on shares of Paylocity in a report on Wednesday, August 5th. Citigroup restated a "market outperform" rating on shares of Paylocity in a research report on Tuesday. TD Cowen upped their price target on Paylocity from $168.00 to $177.00 and gave the stock a "buy" rating in a research note on Thursday, August 20th. Finally, Robert W. Baird set a $201.00 price objective on shares of Paylocity in a research note on Wednesday, August 5th. Twelve investment analysts have rated the stock with a Buy rating and five have issued a Hold rating to the company's stock. According to data from MarketBeat, Paylocity presently has an average rating of "Moderate Buy" and a consensus target price of $166.71.

Paylocity Price Performance

PCTY opened at $177.19 on Friday. 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 stock's 50 day simple moving average is $152.14 and its 200 day simple moving average is $128.11. The firm has a market cap of $9.40 billion, a price-to-earnings ratio of 31.12, a PEG ratio of 2.11 and a beta of 0.50. Paylocity has a 1 year low of $92.99 and a 1 year high of $178.24.

Paylocity (NASDAQ:PCTY - Get Free Report) last announced its earnings results on Tuesday, August 4th. The software maker reported $1.84 earnings per share for the quarter, beating analysts' consensus estimates of $1.62 by $0.22. The business had revenue of $444.73 million during the quarter, compared to the consensus estimate of $431.46 million. Paylocity had a net margin of 15.23% and a return on equity of 27.02%. The business's revenue for the quarter was up 11.0% on a year-over-year basis. During the same quarter last year, the firm earned $1.56 earnings per share. As a group, analysts predict that Paylocity will post 6.92 earnings per share for the current year.

Insider Activity

In other Paylocity news, SVP Joshua Scutt sold 4,730 shares of the company's stock in a transaction on Wednesday, August 19th. The shares were sold at an average price of $149.82, for a total transaction of $708,648.60. Following the sale, the senior vice president directly owned 75,729 shares of the company's stock, valued at approximately $11,345,718.78. This represents a 5.88% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Chairman Steven R. Beauchamp sold 15,000 shares of the business's stock in a transaction on Thursday, October 15th. The shares were sold at an average price of $165.22, for a total value of $2,478,300.00. Following the completion of the sale, the chairman owned 1,243,389 shares of the company's stock, valued at $205,432,730.58. This trade represents a 1.19% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold 119,214 shares of company stock worth $19,164,836 in the last quarter. Corporate insiders own 19.40% of the company's stock.

Institutional Trading of Paylocity

Institutional investors have recently made changes to their positions in the company. Optiver Holding B.V. grew its stake in Paylocity by 5,925.0% in the 1st quarter. Optiver Holding B.V. now owns 241 shares of the software maker's stock valued at $26,000 after buying an additional 237 shares in the last quarter. Global Retirement Partners LLC purchased a new stake in Paylocity during the second quarter valued at approximately $27,000. Basecamp Wealth Advisors LLC increased its stake in Paylocity by 4,250.0% in the 1st quarter. Basecamp Wealth Advisors LLC now owns 261 shares of the software maker's stock worth $28,000 after acquiring an additional 255 shares during the last quarter. Elevation Wealth Partners LLC boosted its position in shares of Paylocity by 500.0% during the second quarter. Elevation Wealth Partners LLC now owns 342 shares of the software maker's stock valued at $36,000 after buying an additional 285 shares during the period. Finally, Parallel Advisors LLC increased its stake in shares of Paylocity by 58.8% during the first quarter. Parallel Advisors LLC now owns 451 shares of the software maker's stock valued at $49,000 after buying an additional 167 shares during the period. Institutional investors own 94.76% of the company's stock.

Key Stories Impacting Paylocity

Here are the key news stories impacting Paylocity this week:

• Positive Sentiment: Paylocity launched its AI-powered Recruiting Optimizer, part of its Ignite AI platform. The company says the tool can improve recruiter productivity by 35%, accelerate hiring by 25% and reduce candidate drop-off by 15%, strengthening its competitive position in cloud-based human capital management software. Paylocity launches AI-powered Recruiting Optimizer
• Positive Sentiment: Citizens JMP raised its price target on PCTY from $150 to $180 while maintaining a “market outperform” rating, indicating confidence in further gains. Citizens JMP raises Paylocity price target
• Positive Sentiment: Zacks highlighted Paylocity’s history of exceeding earnings estimates and said the company currently has the key conditions needed for a potential beat in its next quarterly report. Zacks analysis of Paylocity earnings expectations
• Positive Sentiment: Paylocity’s latest quarterly results beat consensus, with earnings of $1.84 per share versus $1.62 expected and revenue of $444.73 million versus $431.46 million expected. Revenue increased 11% year over year, supporting the company’s growth narrative.
• Neutral Sentiment: Institutional ownership remains high at roughly 94.8%, while several investment firms initiated or expanded positions during the third quarter. The individual trades were relatively small but suggest continued institutional interest.
• Negative Sentiment: Director Steven Sarowitz sold 10,617 shares for approximately $1.80 million on October 20 and 5,744 shares for about $978,000 on October 21, following an earlier sale of 10,445 shares. The transactions were executed under pre-arranged Rule 10b5-1 plans, and Sarowitz still owns more than 4.39 million shares, making the sales a modest reduction in his stake; nevertheless, repeated insider selling can create some pressure while PCTY trades near its 52-week high. Paylocity director stock sale

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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