Paycom CEO Chad Richison Sells More Than $664,000 in Company Shares by Investing.com

In a recent transaction, Chad Richison, CEO, chairman and president of Paycom (NYSE:) Software, Inc. (NYSE:PAYC), sold a significant amount of company stock, totaling more than $664,000. The series of sales took place on September 16, 2024 and was disclosed in a regulatory filing with the Securities and Exchange Commission.

Sales were made at prices ranging from $169.92 to $172.23 per share. Specifically, Richison sold 1,107 shares at an average price of $169.92, another lot of 755 shares at an average price of $170.60, 38 shares at an average price of $171.51 and 50 shares at an average price of $172.23. These trades represent a weighted average price, indicating that the stock was sold in multiple trades at different prices within the specified ranges.

The filing also noted that these sales were made pursuant to a Rule 10b5-1 joint trading plan adopted by Richison and Ernest Group, Inc. on February 16, 2024. Rule 10b5-1 plans allow company insiders to sell a predetermined number of shares. at a predetermined time, providing protection against potential accusations of trading on non-public information.

Following the sales, Richison’s direct ownership of Paycom Software is 2,932,058 shares. In addition, the CEO has indirect ownership through Ernest Group, Inc., where he serves as the sole director and is considered to be the beneficial owner of the company’s stock.

Investors often monitor insider trading because they can provide information about the executive’s view of the company’s stock value and future performance. Headquartered in Oklahoma City, Paycom Software, Inc. specializes in providing complete, cloud-based human capital management software solutions.

In other recent news, Paycom Software has been in the spotlight for a number of financial and strategic developments. The company’s Q2 2024 revenue grew 9% to $438 million, along with GAAP net income of $68 million. However, Paycom has revised down its FY24 revenue guidance by 40 basis points, introducing a degree of uncertainty about future performance.

Despite this review, Paycom announced a significant share buyback program of $1.5 billion. Analysts at TD Cowen and BMO Capital maintained their Hold and Market Perform ratings on Paycom, respectively, but raised their price targets, reflecting the company’s robust financial performance and strategic actions.

Amid these developments, Paycom received positive feedback for their automation tools, Beti and GONE. These tools are part of the company’s focus on growth and automation. Despite the upcoming retirement of CFO Craig Boelte, Paycom maintains a strong financial position with a strong balance sheet and increased share repurchase authorization. These are the recent developments in Paycom Software’s financial and strategic landscape.

InvestingPro Insights

As Paycom Software ( NYSE:PAYC ) CEO Chad Richison adjusts his stake in the company, investors and analysts are scrutinizing the organization’s financial health and future prospects. According to recent data from InvestingPro, Paycom boasts an impressive gross profit margin of 86.1% in the trailing twelve months through Q2 2024, reflecting its strong ability to control costs and maintain profitability. This is a critical metric for investors as it suggests that the company’s core services are being delivered efficiently with high value generated from its earnings.

The company also demonstrates a robust financial structure, holding more cash than debt on its balance sheet. This indicates a solid liquidity position, which can be reassuring to investors, especially in uncertain economic times. Moreover, Paycom has actively managed its share structure as management has aggressively bought shares, signaling confidence in the company’s intrinsic value.

In terms of valuation, Paycom has a market cap of $9.45 billion and trades at a price-to-earnings (P/E) ratio of 20.43. This P/E ratio is considered low relative to the company’s near-term earnings growth, according to one of InvestingPro Tips, which could suggest the stock is undervalued and present a buying opportunity for value investors. Additionally, the company has posted strong returns over the past three months with a total price return of 19.77%, highlighting positive investor sentiment.

For those seeking more detailed analysis and additional insights, there are 11 more InvestingPro tips available for Paycom at https://www.investing.com/pro/PAYC that can provide a deeper understanding of the company’s financial position and market performance .

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