Paycom Software, Inc.
Long

$PAYC attractive entry point (3/5)

220
Conviction: 3/5
could drop further to match RSI hitting solid line (oversold)


General Thesis
  • weekly RSI almost touching oversold levels, which have been pretty good entry points
  • Currently hovering around support line of channel established in July 2014


Growth
  • Gross margins (80%) is a lot higher than past few years
  • Revenue growth (30%) is about historical average, bounce from lows in 2020


Value
  • P/S around 75th percentile, although very high compared to rest of market
  • P/FCF is quite high


Potential Risks
  • could drop to support (June 2018)
  • history is a little short, only goes back to 2014

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