William Blair analyst Jake Roberge has maintained their bullish stance on PCTY stock, giving a Buy rating yesterday.
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Jake Roberge has given his Buy rating due to a combination of factors, primarily driven by Paylocity’s strong financial performance and strategic advancements. The company reported a quarter that exceeded expectations across key metrics, notably with a recurring revenue growth of 13.7%, surpassing the consensus estimate of 12.0%. Additionally, Paylocity has updated its long-term financial targets, aiming for $3 billion in revenue and a free cash flow margin between 25% and 30%, which reflects a significant improvement from previous goals.
Another factor influencing the Buy rating is the positive reception of Paylocity’s new solutions, particularly the Paylocity for Finance platform, which is gaining traction among both new and existing customers. The company’s advancements in AI have also shown promising results, with doubled usage over the past year contributing to improved retention rates and product expansion. Furthermore, the stabilization of demand trends and a strong start to the end-of-year selling season provide additional confidence in Paylocity’s ability to sustain double-digit growth in the coming years.
In another report released yesterday, TD Cowen also maintained a Buy rating on the stock with a $172.00 price target.