Ronald V Waters, Board Member at Paylocity Holding PCTY, disclosed an insider sell on November 13, according to a recent SEC filing.

What Happened: Waters’s recent move involves selling 888 shares of Paylocity Holding. This information is documented in a Form 4 filing with the U.S. Securities and Exchange Commission on Wednesday. The total value is $188,806.

Tracking the Thursday’s morning session, Paylocity Holding shares are trading at $211.62, showing a down of 0.0%.

All You Need to Know About Paylocity Holding

Paylocity is a provider of payroll and human capital management solutions servicing small- to midsize clients in the United States. The company was founded in 1997 and targets businesses with 10-5,000 employees and services about 39,000 clients as of fiscal 2024. Alongside core payroll services, Paylocity offers HCM solutions such as time and attendance and recruiting software as well as workplace collaboration and communication tools.

Key Indicators: Paylocity Holding’s Financial Health

Negative Revenue Trend: Examining Paylocity Holding’s financials over 3 months reveals challenges. As of 30 September, 2024, the company experienced a decline of approximately -12.5% in revenue growth, reflecting a decrease in top-line earnings. As compared to competitors, the company encountered difficulties, with a growth rate lower than the average among peers in the Industrials sector.

Profitability Metrics: Unlocking Value

• Gross Margin: Achieving a high gross margin of 68.05%, the company performs well in terms of cost management and profitability within its sector.

• Earnings per Share (EPS): Paylocity Holding’s EPS is below the industry average, signaling challenges in bottom-line performance with a current EPS of 0.62.

Debt Management: Paylocity Holding’s debt-to-equity ratio is below the industry average at 0.34, reflecting a lower dependency on debt financing and a more conservative financial approach.

Exploring Valuation Metrics Landscape:

• Price to Earnings (P/E) Ratio: With a higher-than-average P/E ratio of 63.0, Paylocity Holding’s stock is perceived as being overvalued in the market.

• Price to Sales (P/S) Ratio: With a relatively high Price to Sales ratio of 8.91 as compared to the industry average, the stock might be considered overvalued based on sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): A high EV/EBITDA ratio of 35.85 positions the company as being more valued compared to industry benchmarks.

Market Capitalization Analysis: Below industry benchmarks, the company’s market capitalization reflects a smaller scale relative to peers. This could be attributed to factors such as growth expectations or operational capacity.

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Navigating the Impact of Insider Transactions on Investments

Insider transactions should be considered alongside other factors when making investment decisions, as they can offer important insights.

In the realm of legality, an “insider” is defined as any officer, director, or beneficial owner holding more than ten percent of a company’s equity securities under Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and major hedge funds. These insiders are required to disclose their transactions through a Form 4 filing, to be submitted within two business days of the transaction.

Notably, when a company insider makes a new purchase, it is considered an indicator of their positive expectations for the stock.

Conversely, insider sells may not necessarily signal a bearish stance on the stock and can be motivated by various factors.

Deciphering Transaction Codes in Insider Filings

When dissecting transactions, the focal point for investors is often those occurring in the open market, meticulously detailed in Table I of the Form 4 filing. A P in Box 3 denotes a purchase, while S signifies a sale. Transaction code C indicates the conversion of an option, and transaction code A denotes a grant, award, or other acquisition of securities from the company.

Check Out The Full List Of Paylocity Holding’s Insider Trades.

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This article was generated by Benzinga’s automated content engine and reviewed by an editor.