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Investing.com - KeyBanc Capital Markets maintained its Overweight rating and $225.00 price target on Paylocity Holding (NASDAQ:PCTY) following investor meetings with the company’s CFO Ryan Glenn. The target represents a 58% upside from the current price of $142.30, with InvestingPro data showing the stock is trading near its 52-week low.
The meetings primarily focused on Paylocity’s updated long-term targets, macroeconomic conditions, workforce levels, and AI automation both in product offerings and internal operations.
KeyBanc highlighted Paylocity’s expanding platform offerings, particularly those aimed at the office of the CFO and CIO, as key growth drivers for the human capital management (HCM) software provider. InvestingPro data reveals Paylocity maintains impressive gross profit margins of 69% while achieving 13.3% revenue growth over the last twelve months.
The investment firm views Paylocity as "one of the best executing HCM providers with the clearest TAM-expanding growth strategies" in the market today.
KeyBanc noted that with shares trading at approximately 18 times its fiscal year 2027 free cash flow estimates, the firm sees a "compelling risk-reward" opportunity at current price levels. This assessment aligns with InvestingPro analysis, which indicates Paylocity is currently undervalued despite trading at a P/E ratio of 35.6, with the stock down nearly 27% over the past six months.
In other recent news, Paylocity Holding’s fiscal first-quarter results have captured significant attention, with recurring revenue surpassing Street estimates by approximately $6 million. The company’s earnings per share and free cash flow also demonstrated strong performance, as noted by Cantor Fitzgerald, which adjusted its price target to $190 while maintaining an Overweight rating. Guggenheim upgraded Paylocity from Neutral to Buy, setting a price target of $180, citing confidence in the company’s fiscal 2026 outlook. Jefferies, despite expressing concerns about the sector, maintained a Buy rating while lowering its price target to $180, acknowledging that Paylocity’s recurring revenues and EBITDA exceeded expectations. Citizens also adjusted its price target to $245 from $270, highlighting Paylocity’s product differentiation and innovation, including its AI Assistant feature. Meanwhile, BMO Capital lowered its price target to $185, describing the company’s results as consistent with anticipated positive outcomes. These developments reflect varied analyst perspectives, focusing on Paylocity’s recent financial performance and strategic initiatives.
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