Paylocity Holdng (PCTY)

Return on equity (ROE)

Jun 30, 2025 Mar 31, 2025 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
Net income (ttm) US$ in thousands 227,127 227,340 221,171 221,822 206,766 195,201 167,503 144,987 140,822 118,714 95,944 90,197 90,777 87,514 89,502 89,291 70,819 63,886 67,184 63,009
Total stockholders’ equity US$ in thousands 1,233,750 1,208,740 1,172,140 1,105,910 1,033,060 1,099,410 986,773 892,639 842,863 768,746 677,767 610,846 613,463 565,419 506,693 467,573 476,930 454,609 408,218 386,820
ROE 18.41% 18.81% 18.87% 20.06% 20.01% 17.76% 16.97% 16.24% 16.71% 15.44% 14.16% 14.77% 14.80% 15.48% 17.66% 19.10% 14.85% 14.05% 16.46% 16.29%

June 30, 2025 calculation

ROE = Net income (ttm) ÷ Total stockholders’ equity
= $227,127K ÷ $1,233,750K
= 18.41%

The analysis of Paylocity Holdings' return on equity (ROE) from late 2020 through mid-2025 reveals a generally upward trend with some fluctuations. Starting at 16.29% on September 30, 2020, the ROE experienced a slight increase to 16.46% by the end of 2020, indicating a stable and positive return on shareholders’ equity during that period.

Throughout 2021, the ROE exhibited some variability: it decreased to 14.05% by March 2021 but then rebounded to 19.10% by September 2021, reflecting an improvement in profitability or efficiency in generating earnings relative to shareholders’ equity. The subsequent decline to 17.66% in December 2021 and further decreases to 15.48% in March 2022 and around 14.80%–14.77% in mid to late 2022 suggest some period of margin compression or increased equity base without proportional earnings growth.

From late 2022 onwards into 2023, the ROE stabilizes slightly above the 14–16% range, with a notable increase to 15.44% by March 2023 and a steady climb thereafter, reaching 16.71% in June 2023 and 16.24% in September 2023. The upward momentum continues into the later months, with ROE reaching 16.97% by the end of 2023 and then further rising to 17.76% in March 2024. The trend shows a significant acceleration in profitability, with the ROE surpassing 20% in June 2024 and maintaining an elevated level at 20.06% in September 2024.

In the subsequent quarters, the ROE exhibits slight fluctuations but remains at elevated levels, with 18.87% in December 2024, declining marginally to 18.81% in March 2025, and approximately 18.41% in June 2025. The overall pattern indicates that Paylocity has experienced periods of profitability growth, especially post-2022, with ROE reaching and sustaining higher levels, which may be attributable to improved operational efficiency, revenue growth, or margin expansion over this timeframe.

The observed trends in ROE suggest that the company has demonstrated an ability to enhance shareholders’ returns over time, despite some cyclical variations. The sustained increase above pre-2022 levels signifies a period of strategic or operational improvement, contributing positively to shareholder value.