Paycom (NYSE:PAYC) Software, Inc. (NYSE:PAYC) CEO, President, and Chairman Chad Richison has sold a portion of his company stock, according to a recent SEC filing. The transactions, which took place on July 3, 2024, involved the sale of Paycom common stock totaling over $558,887.
The sales were executed in multiple transactions at prices ranging from $142.70 to $144.15 per share. Specifically, the shares were sold in separate tranches with prices averaging $142.70, $143.43, and $144.15 for different groups of shares. These weighted average prices reflect a range of individual transaction prices: from $142.12 to $143.09 for some shares, from $143.10 to $144.08 for others, and from $144.09 to $144.20 for the remainder.
Richison's transactions were made under a joint Rule 10b5-1 trading plan, which was previously adopted on February 16, 2024. This plan is a common arrangement that allows company insiders to sell shares at predetermined times to avoid accusations of insider trading.
The SEC filing also noted that Richison may be deemed to beneficially own shares owned by Ernest Group, Inc., which is directed by Richison and owned by him and certain trusts for his children. Additionally, several trusts for the benefit of Richison's family members are listed, suggesting a complex structure of indirect ownership.
Following these transactions, Richison still holds a significant number of Paycom shares directly and indirectly, indicating a continuing stake in the company's future performance. The details of these holdings and transactions are available in the full SEC Form 4 filing.
In other recent news, Paycom Software has seen significant developments in its financial performance and leadership structure. The company recently reported an 11% increase in revenue year-over-year, reaching $500 million, with net income and adjusted EBITDA surpassing expectations at $247 million and nearly $230 million, respectively. Despite these robust results, Paycom maintained its full-year 2024 revenue and adjusted EBITDA guidance, projecting revenues between $1.860 billion and $1.885 billion, and adjusted EBITDA between $720 million and $730 million.
Several analysts have adjusted their outlooks on Paycom. TD Cowen lowered its price target to $170, citing a lower-than-anticipated revenue guidance for FY24. BMO Capital maintained its Market Perform rating, noting challenges due to macroeconomic pressures and strategic focus areas. Mizuho also reduced its price target to $170, maintaining a neutral stance, citing potential challenges such as the cannibalization of its Beti product and potential macroeconomic headwinds.
Amid these financial updates, Paycom has undergone significant leadership changes, including the appointment of Randy Peck as the new COO, who brings over 34 years of experience in payroll and human capital management. Other promotions include Matt Paque to Chief Legal Officer and Jennifer Kraszewski to Chief Human Resources Officer. These recent developments reflect Paycom's strategic moves to navigate its financial and leadership challenges.
InvestingPro Insights
In light of the recent stock sales by Paycom Software, Inc. (NYSE:PAYC) CEO Chad Richison, investors may be evaluating the company's current financial health and market position. InvestingPro data and tips provide valuable context for these considerations.
InvestingPro Data highlights Paycom's solid financial metrics as of Q1 2024. The company's Market Cap stands at $8.04 billion, and it boasts an impressive Gross Profit Margin of 86.55%. Additionally, Paycom has experienced significant revenue growth, with an 18.23% increase over the last twelve months.
InvestingPro Tips suggest that Paycom's management strategy includes aggressive share buybacks and the company maintains a strong liquidity position, holding more cash than debt on its balance sheet. Moreover, analysts predict that the company will be profitable this year, which is corroborated by the fact that Paycom has been profitable over the last twelve months.
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