The end of earnings season is always a good time to take a step back and look at who’s excelling (and who’s not so good). Let’s take a look at how HR software stocks fared in the third quarter, starting with Paychex (NASDAQ:PAYX).
Modern HR software has two powerful benefits: cost savings and ease of use. To save costs, businesses of all sizes much prefer the flexibility of cloud-based software delivered through a web browser and paid for on a subscription basis, rather than the hassle and complexity of purchasing and managing business software on-premises. In terms of usability, the consumerization of enterprise software creates seamless experiences that merge multiple standalone processes, such as payroll and compliance, into a single, easy-to-use platform.
The six HR software stocks we track reported a mixed third quarter. As a group, revenues were in line with analyst consensus estimates, while revenues for the next quarter were 1.7% below.
Fortunately, HR software stocks have performed well, with an average price increase of 12.8% since the last earnings results.
Paychex (NASDAQ:PAYX), one of the oldest service providers in the industry, offers payroll and HR software solutions to its customers.
Paychex reported revenue of $1.32 billion, up 2.5% year over year. This print was in line with analyst expectations, and overall it was a satisfying quarter for the company with a decent improvement in analysts’ EBITDA estimates.
President and Chief Executive Officer John Gibson commented, “We are off to a solid start to fiscal 2025 with 3% growth in total revenue in the first quarter. Excluding the impact of the expiration of the Employee Retention Tax Credit (“ERTC “) program and one day less payroll processing, sales growth was 7%.
Paychex total revenue
Interestingly, the stock is up 10% since reporting and is currently trading at $147.61.
Is Now the Time to Buy Paychex? See our full analysis of earnings results here. It’s free.
Founded in 1990 in Cincinnati, Ohio, Paycor (NASDAQ: PYCR) provides software for small businesses to manage their payroll and HR needs in one place.
Paycor reported revenue of $167.5 million, up 16.6% year over year, and beat analyst expectations by 3.3%. The company had a strong quarter with an impressive return to analyst EBITDA estimates and a solid improvement in analyst billing estimates.
Paycor’s total revenue
Paycor achieved the highest earnings estimates from analysts and the fastest revenue growth among its peers. The market seems pleased with the results, as the stock is up 5.6% since reporting. It is currently trading at $17.60.
Is Now the Time to Buy Paycor? See our full analysis of earnings results here. It’s free.
Asure (NASDAQ:ASUR), formed from the merger of two small workforce management companies in 2007, offers cloud-based payroll and HR software for small and medium-sized businesses (SMBs).
Asure reported revenue of $29.3 million, flat year-over-year, falling 6.5% short of analyst expectations. It was a disappointing quarter as next quarter’s revenue expectations significantly missed analysts’ expectations and analysts’ EBITDA estimates were significantly missed.
Asure delivered the weakest performance against analyst estimates, the slowest revenue growth and the weakest full-year forecast update in the group. As expected, the stock has fallen 8.1% since the results and is currently trading at $9.13.
Read our full analysis of Asure’s results here.
Dayforce (NYSE:DAY), founded in 1992 as Ceridian, an outsourced payroll processor and transformed following the acquisition of Dayforce in 2012, is a provider of cloud-based payroll and HR software aimed at mid-market companies.
Dayforce reported revenue of $440 million, up 16.6% year over year. This number exceeded analyst expectations by 2.7%. Zooming out, it was a mixed quarter as it also delivered an impressive result from analyst EBITDA estimates, but EBITDA guidance for the next quarter fell short of analyst expectations.
The stock is up 20.2% since reporting and is currently trading at $78.51.
Read our full, actionable report on Dayforce here. It’s free.
Founded in 1998 as one of the first online payroll companies, Paycom (NYSE:PAYC) provides software for small and medium-sized businesses (SMBs) to manage their payroll and HR needs in one place.
Paycom reported revenue of $451.9 million, up 11.2% year over year. This print exceeded analyst expectations by 1.1%. Overall, it was a strong quarter as it also solidly beat analyst EBITDA estimates and full-year EBITDA expectations, exceeding analyst expectations.
The stock is up 32% since reporting and is currently trading at $227.50.
Read our full, actionable report on Paycom here. It’s free.
Thanks to the Fed’s series of rate hikes in 2022 and 2023, inflation has cooled significantly from its post-pandemic highs and is moving closer to the 2% target. This disinflation has occurred without serious consequences for economic growth, indicating a soft landing success. The stock market boomed in 2024, boosted by recent interest rate cuts (0.5% in September and 0.25% in November), and a notable rally followed Donald Trump’s presidential election victory in November, sending the indices to historic highs were pushed. Nevertheless, the outlook for 2025 remains clouded by possible changes in trade policy and corporate tax discussions, which could impact business confidence and growth. The path forward involves both optimism and caution as new policies take shape.
Do you want to invest in winners with rock-solid fundamentals? Check out our 9 best stocks that are beating the market and add them to your watchlist. These companies are primed for growth regardless of the political or macroeconomic environment.
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