BMO Capital analyst Daniel Jester maintained a Buy rating on Paylocity yesterday and set a price target of $185.00.
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Daniel Jester has given his Buy rating due to a combination of factors that highlight Paylocity’s strong performance and future potential. The company’s fiscal first-quarter results exceeded expectations, with total revenue growth of 12.5% year-over-year surpassing the midpoint of guidance by approximately 2%. This growth was primarily driven by recurring revenue, which underscores Paylocity’s steady execution and ability to outperform its peers in the Human Capital Management (HCM) and payroll sector.
Furthermore, Paylocity demonstrated better-than-expected margin performance, with an EBITDA margin expansion of about 40 basis points year-over-year, despite guidance predicting a contraction. The company’s updated FY26 guidance reflects an increase in revenue and EBITDA expectations, indicating a clear path to margin improvement with new long-term targets. These factors, combined with Paylocity’s strategic expansion into other back-office workloads and the potential for greater efficiencies and scale, underpin Jester’s positive outlook and Buy rating for the stock.
In another report released today, Needham also maintained a Buy rating on the stock with a $250.00 price target.