Barclays Lifts Paycom Price Target To $55

In a note to investors Tuesday, Barclays analyst Raimo Lenschow said the underlying story in Paycom Software Inc PAYC remains very healthy.

Barclays recently hosted investor meetings in New York with Paycom management; the message was in line with commentary from the company following the release of its Q2 results, when it reported a top- and bottom-line estimate beat. The company also reported Q4 and fiscal year 2016 guidance above estimates.

Lenschow said Paycom has large opportunities still ahead. Only represented in 42 out of 120 potential markets, the company is adding more products, and existing offices are now beginning to benefit from repeat business with established contacts.

Barclays lifted its price target from $51 to $55 per share for Paycom, implying approximately 15 percent upside from $47.85, where the stock traded at midday Tuesday. The firm maintains its Overweight rating on the stock.

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