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The Bottom Fishing Club - Paycom Software: A Bargain Usin...
Paul Franke · 2026-05-01 · via All Articles on Seeking Alpha

Summary

  • Paycom Software now trades at its lowest valuation since 2014's IPO, with a forward P/E of 11.9x and free cash flow yield approaching 6%.
  • PAYC's high-margin, net debt-free business positions it favorably against SaaS database and software peers, despite AI-driven fears sector-wide.
  • Technical momentum indicators and insider buying suggest a bottoming process, with high short interest providing the potential for a sharp upside move.
  • I rate PAYC a buy, targeting +60% upside to $200 over 12 months if growth holds, while downside risk should be limited, nearer $100 per share.
Value Price Scale Business Concept

IvelinRadkov/iStock via Getty Images

Paycom Software, Inc. (PAYC) is another software/cloud stock caught up in the SaaSpocalypse selling on Wall Street. The fear is individual customers will develop their own AI software solutions over time, eliminating the need for Paycom products.

However, I don't see

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Analyst’s Disclosure: I/we have a beneficial long position in the shares of PAYC, PYPL, ACN either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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