PCTY PCTY

Name: PCTY Crucible Score
Creator: Kaladin Capital Intelligence

UnknownUnknownN/A📅 Scored April 7, 2026

Price at analysis: $109.60

Crucible Score

75.8

B+

Quality × Value Composite

KQI — Quality

77.1

B+

Fundamental Quality Index

KVI — Value

74.3

Valuation Attractiveness Index

Crucible Verdict — PCTY

Paylocity (PCTY) delivers exceptional operational execution with a perfect 22/22 earnings beat streak and strong financial quality metrics, but trades at a 25% discount to fair value despite its consistent performance. The company's weak diversification profile and moderate market position create vulnerability in economic downturns. Recent insider selling signals potential near-term headwinds despite the attractive valuation gap.

— Kal, Kaladin Capital Intelligence

◆ KQI Quality Dimensions

Financial Quality

82.3

Growth Profile

86.5

Moat Durability

83.2

Management Effectiveness⚠

79.6

Diversification & Resilience

23.2

Market Position

58.0

Weakest dimension: Diversification & Resilience (23.2)

◆ KVI Value Dimensions

DCF Margin of Safety

65.0

FCF Yield & Cash Returns

73.7

Relative Valuation

81.9

Growth-Adjusted Value

95.0

Historical Valuation

86.5

Macro Context

13.9

◆ DCF Valuation Scenarios

Bear Case

$88.52

Base Case

$137.45

Bull Case

$199.78

Price at Analysis

$109.60

Scenario	Fair Value	Rev CAGR (5yr)	Terminal Margin	WACC
🔴 Bear	$88.52	8.0%	20.0%	8.0%
🟢 Base	$137.45	12.0%	23.0%	7.4%
🟢 Bull	$199.78	15.0%	26.0%	6.9%

Key Assumptions: PCTY has demonstrated strong revenue growth (~20% 5-yr CAGR) with expanding operating margins from 9% to 19%. WACC is calculated using CAPM with beta of 0.60 and an equity risk premium of 5.5%, yielding a base cost of equity of ~7.7%; minimal debt keeps WACC close to cost of equity. Operating margins are projected conservatively relative to EBITDA margins given the SaaS model, with D&A running ~6% of revenue and capex normalizing around 4.5% of revenue. Tax rate normalized to 22% reflecting recent stabilization after prior years of tax benefits.

◆ Financial Snapshot

Profitability

Gross Margin69.0%

Operating Margin20.1%

Net Margin14.2%

ROIC20.9%

ROE21.7%

Balance Sheet

Balance SheetD/E: 0.16*, CR: 0.07* (* = TTM)

Cash ConversionFCF/EPS: 1.86x

Capital IntensityCapex/Rev: 4.7%

Altman Z-Score0.29 (Distress)

Piotroski F-Score8/9 (Strong)

Growth

Revenue CAGR23.4% CAGR

Earnings CAGR33.8% CAGR

Growth ConsistencyCV: 0.30

Segment Breadth2/2 growing (100%)

Quarterly TrendMargin↑, WC↓, Exp↓

Earnings CredibilityConsistent Beater

◆ Analyst Consensus & Leadership

Leadership & Governance

CEO Ownership19.4%

Compensation96% performance-based

Insider ActivitySelling

Capital AllocationROIC 20.9% vs WACC 4.7%

Earnings Beat Rate100% (22/22)

◆ Related Companies in Our Universe

Other Unknown companies scored by the Crucible:

ADBE81.8A-NICE80.7A-DECK79.9A-INTU79.9A-EXEL78.3A-MTCH78.2A-TTD78.0B+

Methodology All Scores Crucible Briefs Performance @KaladinCI

Analysis conducted April 7, 2026 based on most recent SEC filings. Updated quarterly, after new SEC filings.

Point-in-time fundamental analysis. Not investment advice. Scores reflect company quality and valuation at time of analysis and may not reflect current market conditions.