PAYC
Paycom Software, Inc.
$232.31
Platform & Compounding FCF
85%
Two-stage FCF DCF
Mild
·
Conviction
Fair Value
Trading 0.5% below fair value
You pay
$232.31
Bear
$149.41
Fair
$233.51
Bull
$327.86
Bear
$149.41
-35.7%
9% stage 1 growth, 11% discount
Fair
$233.51
+0.5%
15% stage 1 growth, 11% discount
Bull
$327.86
+41.1%
20% stage 1 growth, 11% discount
Adjust Assumptions
15.3%
11.0%
3.0%
Key Value Driver
FCF growth rate (15% base case)
Terminal Value % of EV
43%
Implied Market Multiple
31.9x
Market is pricing in (growth)
15.2%
vs 15.3% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (36 analysts)
$201.18
Divergence from AlphaVal
16%
Summary
Using a two-stage FCF DCF with 15% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $233.51 per share.
Key Risks
- P/E alone misleads — earnings depressed by growth investment
- Cyclical or commodity businesses may be misclassified as platforms
- Terminal value dominance suggests sensitivity to long-run assumptions