Paylocity (PCTY) Reports Q1: Everything You Need To Know Ahead Of Earnings

Jabin Bastian /
2024/05/01 3:11 am EDT

Payroll and human resources software provider, Paylocity (NASDAQ:PCTY) will be reporting results tomorrow after the bell. Here's what to look for.

Paylocity met analysts' revenue expectations last quarter, reporting revenues of $326.4 million, up 19.5% year on year. It was a weak quarter for the company, with underwhelming revenue guidance for the next quarter and a decline in its gross margin.

Is Paylocity a buy or sell going into earnings? Read our full analysis here, it's free.

This quarter, analysts are expecting Paylocity's revenue to grow 16.9% year on year to $397.4 million, slowing from the 38.2% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $1.98 per share.

Paylocity Total Revenue

The majority of analysts covering the company have reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Paylocity has a history of exceeding Wall Street's expectations, beating revenue estimates every single time over the past two years by 2.9% on average.

Looking at Paylocity's peers in the finance and HR software segment, only Paychex has reported results so far. It missed analysts' revenue estimates by 1.2%, delivering year-on-year sales growth of 4.2%. The stock was down 1.1% on the results.

Read our full analysis of Paychex's earnings results here.

Growth stocks have seen elevated volatility as investors debate the Fed's monetary policy, and while some of the finance and HR software stocks have fared somewhat better, they have not been spared, with share prices down 4% on average over the last month. Paylocity is down 6.6% during the same time and is heading into earnings with an average analyst price target of $193.3 (compared to the current share price of $155.5).

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