Paycom Software Shares Exceed Analyst Target Price, Investors Take Note

In recent trading, shares of Paycom Software Inc (Symbol: PAYC) have surpassed the average analyst 12-month target price of $221.93, currently priced at $225.86 per share. When a stock reaches an analyst’s set target price, the analyst typically has two options: downgrade on valuation or adjust their target price upwards. Their decision may also be influenced by recent fundamental developments impacting the company’s stock price—if prospects look promising, a higher target could be warranted.

The average target price for Paycom Software Inc is drawn from contributions by 14 different analysts within the Zacks coverage universe. However, this average represents a range of opinions. Some analysts have lower targets than the average; one, for instance, projects a price of $187.00. Conversely, another analyst suggests a high target of $250.00, leading to a standard deviation of $17.076.

Investors analyze the average PAYC price target to benefit from the collective insight of multiple analysts rather than the opinion of a single expert. With PAYC trading above the average target price of $221.93 per share, investors are now considering whether this is merely a step toward even higher targets or if the valuation has become stretched, raising the question of whether to take profits. Below is a table summarizing current analyst ratings for Paycom Software Inc:

Recent PAYC Analyst Ratings Breakdown
»	Current	1 Month Ago	2 Month Ago	3 Month Ago
Strong buy ratings:	3	3	2	2
Buy ratings:	0	0	0	0
Hold ratings:	15	15	16	16
Sell ratings:	0	0	0	0
Strong sell ratings:	0	0	0	0
Average rating:	2.67	2.67	2.78	2.78

The average rating mentioned in the table is on a scale of 1 to 5, with 1 being Strong Buy and 5 being Strong Sell. This article utilizes data provided by Zacks Investment Research via Quandl.com.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.