Paycom Soft (PAYC)

Activity ratios

Short-term

Turnover ratios

	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Inventory turnover	199.78	311.81	282.42	258.72	132.38	136.09	114.01	237.84	143.14	171.35	154.90	119.28	107.34	129.13	83.43	118.79	94.77	150.07	131.40	106.02
Receivables turnover	48.57	61.83	85.73	82.59	48.33	42.88	59.70	63.36	40.72	42.67	33.37	43.99	42.96	37.60	58.16	96.73	55.29	57.19	48.41	159.46
Payables turnover	19.91	37.84	29.09	22.87	13.25	19.61	13.93	14.28	28.05	15.72	14.82	10.70	18.20	12.92	31.30	19.40	21.73	22.38	27.83	23.64
Working capital turnover	6.07	3.30	2.98	3.00	3.55	3.90	4.34	3.53	4.03	4.37	4.41	4.38	5.74	5.40	6.45	5.07	6.26	7.34	7.52	9.30

Paycom Software Inc's activity ratios indicate efficiency in managing its key operating assets and liabilities.

- Inventory turnover has shown an increasing trend, reaching a high of 252.20 in Q3 2023, suggesting that the company is efficiently selling its inventory. This indicates effective inventory management.

- Receivables turnover has also been increasing over time, reaching 61.92 in Q3 2023, highlighting that the company is collecting its receivables more quickly. This efficient collection process indicates effective credit management.

- Payables turnover has shown fluctuations but generally shows an increasing trend, reaching 30.61 in Q3 2023. This suggests that the company is taking longer to pay its suppliers, potentially improving cash flow management.

- Working capital turnover has varied over the periods but has generally been above 3, indicating that the company is effectively utilizing its working capital to generate revenue. A higher working capital turnover ratio suggests more efficient use of working capital in generating sales.

Overall, Paycom Software Inc's activity ratios demonstrate effective management of key components of its working capital cycle, which can contribute to improved financial performance and profitability.

Average number of days

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Days of inventory on hand (DOH)	days	1.83	1.17	1.29	1.41	2.76	2.68	3.20	1.53	2.55	2.13	2.36	3.06	3.40	2.83	4.38	3.07	3.85	2.43	2.78	3.44
Days of sales outstanding (DSO)	days	7.52	5.90	4.26	4.42	7.55	8.51	6.11	5.76	8.96	8.55	10.94	8.30	8.50	9.71	6.28	3.77	6.60	6.38	7.54	2.29
Number of days of payables	days	18.33	9.65	12.55	15.96	27.54	18.62	26.19	25.56	13.01	23.22	24.63	34.13	20.05	28.26	11.66	18.81	16.80	16.31	13.12	15.44

Paycom Software Inc's activity ratios provide insights into how efficiently the company manages its inventory, collects its receivables, and pays its payables. In terms of Days of Inventory on Hand (DOH), the company has shown improving efficiency over the quarters, with the most recent quarter at 1.45 days, indicating that Paycom is managing its inventory more effectively and minimizing the time inventory sits on its shelves.

Days of Sales Outstanding (DSO) measures how quickly the company collects payment from its customers. Paycom has displayed a downward trend in DSO, from 8.51 days in Q3 2022 to 5.89 days in Q3 2023, which suggests that the company is collecting its receivables more promptly.

Regarding the Number of Days of Payables, Paycom has also shown a decreasing trend, which means the company is taking longer to pay its suppliers. This could be a strategic decision to improve cash flow or negotiate more favorable payment terms. However, the company should strike a balance between extending payables and maintaining good relationships with its suppliers.

Overall, the activity ratios indicate that Paycom Software Inc is effectively managing its working capital cycle, optimizing its inventory levels, collecting receivables efficiently, and strategically managing its payables.

Long-term

	Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Fixed asset turnover	3.40	3.47	3.49	3.49	3.41	3.36	3.23	3.14	3.02	3.01	2.90	2.89	2.95	2.95	2.97	3.06	3.09	3.09	3.32	3.26
Total asset turnover	0.40	0.42	0.39	0.35	0.35	0.39	0.25	0.21	0.33	0.23	0.29	0.26	0.32	0.33	0.41	0.34	0.30	0.44	0.36	0.30

Paycom Software Inc's long-term activity ratios provide insight into how effectively the company is utilizing its assets to generate revenue.

The fixed asset turnover ratio, which measures how efficiently the company is using its fixed assets to generate sales, has been relatively stable and high, ranging between 3.14 and 3.50 over the past eight quarters. A higher fixed asset turnover ratio indicates that the company is effectively utilizing its long-term assets to generate sales. Paycom Software's consistent and high fixed asset turnover ratio suggests that the company is efficiently managing its fixed assets to drive revenue.

On the other hand, the total asset turnover ratio, which indicates the company's ability to generate sales relative to its total assets, has shown some fluctuations over the same period. The ratio has varied between 0.21 and 0.42 in the past eight quarters. A higher total asset turnover ratio is generally preferred as it suggests that the company is generating more revenue per dollar of total assets. Paycom Software's total asset turnover ratio has shown some volatility, indicating fluctuations in how effectively the company is utilizing its total assets to generate sales.

In summary, Paycom Software Inc's fixed asset turnover ratio indicates efficient utilization of fixed assets to generate revenue, while the total asset turnover ratio shows some fluctuations in the company's effectiveness in generating sales relative to its total assets.