Paycom Software, Inc. (PAYC), headquartered in Oklahoma, specializes in cloud-based human capital management (HCM) solutions offered as a software-as-a-service. With a market cap of $12.5 billion, the company equips small to mid-sized businesses with the tools and analytics needed to oversee the entire employment life cycle, from hiring to retirement.

Companies worth $10 billion or more are generally described as “large-cap” stocks, and Paycom fits right into that category, with its market cap exceeding this threshold. It stands out for its comprehensive, cloud-based HCM solutions, catering to small and mid-sized businesses. Its all-in-one platform streamlines payroll, talent management, and workforce analytics, reducing reliance on multiple vendors. 

As a result, PAYC benefits from strong client retention and also enjoys high recurring revenue due to its subscription-based model. Additionally, its focus on continuous innovation, including AI-driven enhancements, strengthens its competitive edge in the HCM space.

While PAYC is currently trading 9% below its 52-week high of $242.74, reached on Dec. 11, its shares have rallied 7.8% over the past three months, significantly outperforming the Dow Jones Industrial Average’s ($DOWI) 1.3% fall during the same time frame.

Moreover, over the past six months, shares of PAYC are up 32.8%, massively surpassing $DOWI’s marginal drop. PAYC has increased 11.4% over the past 52 weeks, exceeding $DOWI’s 6.1% returns over the same time frame. 

PAYC has been trading over its 50-day moving average since mid-February and has remained above its 200-day moving average since late October, indicating an uptrend.

On Mar. 10, Paycom Software shares climbed over 2% after KeyBanc Capital Markets upgraded the stock to “Overweight” from “Sector-Weight,” setting a price target of $245.

PAYC has outperformed its rival, Workday, Inc. (WDAY), which declined 13.9% over the past 52 weeks and 2.6% over the past six months. 

Despite Paycom’s recent outperformance, analysts remain cautious about its prospects. The stock has a consensus rating of “Hold” from the 18 analysts covering it, and the mean price target of $224.14 suggests a 1.5% premium to its current levels.