Paycom Soft (PAYC)

Pretax margin

		Dec 31, 2024	Sep 30, 2024	Jun 30, 2024	Mar 31, 2024	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
Earnings before tax but after interest (EBT) (ttm)	US$ in thousands	649,000	609,412	603,139	596,841	472,399	474,476	447,723	427,713	389,578	345,591	313,852	288,251	255,962	222,561	213,294	192,793	185,936	210,454	226,663	252,293
Revenue (ttm)	US$ in thousands	1,883,127	1,823,922	1,778,291	1,741,918	1,693,674	1,629,687	1,557,551	1,473,336	1,375,218	1,289,596	1,211,623	1,136,845	1,055,524	991,485	931,823	871,264	841,434	813,896	792,370	780,096
Pretax margin		34.46%	33.41%	33.92%	34.26%	27.89%	29.11%	28.75%	29.03%	28.33%	26.80%	25.90%	25.36%	24.25%	22.45%	22.89%	22.13%	22.10%	25.86%	28.61%	32.34%

December 31, 2024 calculation

Pretax margin = EBT (ttm) ÷ Revenue (ttm)
= $649,000K ÷ $1,883,127K
= 34.46%

Paycom Soft has shown a fluctuating trend in its pretax margin over the analyzed periods. The pretax margin, which measures the company's profitability before taxes, started at a healthy 32.34% as of March 31, 2020, showing strong operational efficiency. However, there was a gradual decline in the margin over the next few quarters, reaching its lowest point of 22.10% by December 31, 2020.

Subsequently, the pretax margin stabilized around the low 20% range for the first half of 2021. From September 30, 2021, onwards, there was a moderate improvement in the margin, reaching 29.11% by September 30, 2023. The margin experienced a temporary dip by the end of December 2023 but quickly rebounded above 34% as of March 31, 2024.

Overall, Paycom Soft's pretax margin indicates a mix of profitability levels, with some periods of optimization and others showing challenges. The company's management should continue to focus on operational efficiency and cost management to sustain or improve profitability in the future.