Looking back on HR software stocks’ Q3 earnings, we examine this quarter’s best and worst performers, including Paycom (NYSE:PAYC) and its peers.

Modern HR software has two powerful benefits: cost savings and ease of use. For cost savings, businesses large and small much prefer the flexibility of cloud-based, web-browser-delivered software paid for on a subscription basis rather than the hassle and complexity of purchasing and managing on-premise enterprise software. On the usability side, the consumerization of business software creates seamless experiences whereby multiple standalone processes like payroll processing and compliance are aggregated into a single, easy-to-use platform.

The 6 HR software stocks we track reported a mixed Q3. As a group, revenues were in line with analysts’ consensus estimates while next quarter’s revenue guidance was 1.7% below.

Thankfully, share prices of the companies have been resilient as they are up 7.9% on average since the latest earnings results.

Paycom (NYSE:PAYC)

Founded in 1998 as one of the first online payroll companies, Paycom (NYSE:PAYC) provides software for small and medium-sized businesses (SMBs) to manage their payroll and HR needs in one place.

Paycom reported revenues of $451.9 million, up 11.2% year on year. This print exceeded analysts’ expectations by 1.1%. Overall, it was a strong quarter for the company with an impressive beat of analysts’ EBITDA estimates.

“We posted solid third quarter results and continue to make significant progress toward full-solution automation,” said Paycom founder, CEO and chairman, Chad Richison.

Interestingly, the stock is up 30% since reporting and currently trades at $224.02.

We think Paycom is a good business, but is it a buy today? Read our full report here, it’s free.

Best Q3: Paycor (NASDAQ:PYCR)

Found in 1990 in Cincinnati, Ohio, Paycor (NASDAQ: PYCR) provides software for small businesses to manage their payroll and HR needs in one place.

Paycor reported revenues of $167.5 million, up 16.6% year on year, outperforming analysts’ expectations by 3.3%. The business had a strong quarter with an impressive beat of analysts’ EBITDA estimates and a solid beat of analysts’ billings estimates.

Paycor achieved the biggest analyst estimates beat and fastest revenue growth among its peers. Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 1.6% since reporting. It currently trades at $16.40.

Is now the time to buy Paycor? Access our full analysis of the earnings results here, it’s free.

Weakest Q3: Asure (NASDAQ:ASUR)

Created from the merger of two small workforce management companies in 2007, Asure (NASDAQ:ASUR) provides cloud based payroll and HR software for small and medium-sized businesses (SMBs).

Asure reported revenues of $29.3 million, flat year on year, falling short of analysts’ expectations by 6.5%. It was a disappointing quarter as it posted revenue guidance for next quarter missing analysts’ expectations.

Asure delivered the weakest performance against analyst estimates, slowest revenue growth, and weakest full-year guidance update in the group. As expected, the stock is down 9.7% since the results and currently trades at $8.97.

Read our full analysis of Asure’s results here.

Paychex (NASDAQ:PAYX)

One of the oldest service providers in the industry, Paychex (NASDAQ:PAYX) offers its customers payroll and HR software solutions.

Paychex reported revenues of $1.32 billion, up 2.5% year on year. This print was in line with analysts’ expectations. Overall, it was a satisfactory quarter as it also put up a decent beat of analysts’ EBITDA estimates.

The stock is up 5.8% since reporting and currently trades at $141.92.

Read our full, actionable report on Paychex here, it’s free.

Dayforce (NYSE:DAY)

Founded in 1992 as Ceridian, an outsourced payroll processor and transformed after the 2012 acquisition of Dayforce, Dayforce (NYSE:DAY) is a provider of cloud based payroll and HR software targeted at mid-sized businesses.

Dayforce reported revenues of $440 million, up 16.6% year on year. This print surpassed analysts’ expectations by 2.7%. More broadly, it was a mixed quarter as it also logged an impressive beat of analysts’ EBITDA estimates.

The stock is up 16.2% since reporting and currently trades at $75.91.

Read our full, actionable report on Dayforce here, it’s free.

Market Update

Thanks to the Fed’s rate hikes in 2022 and 2023, inflation has been on a steady path downward, easing back toward that 2% sweet spot. Fortunately (miraculously to some), all this tightening didn’t send the economy tumbling into a recession, so here we are, cautiously celebrating a soft landing. The cherry on top? Recent rate cuts (half a point in September, a quarter in November) have kept 2024 stock markets frothy, especially after Trump’s November win lit a fire under major indices and sent them to all-time highs. However, there's still plenty to ponder — tariffs, corporate tax cuts, and what 2025 might hold for the economy.

Want to invest in winners with rock-solid fundamentals? Check out our Top 5 Quality Compounder Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

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