Paylocity stock rating maintained by KeyBanc with $220 price target
Investing.com
Published Jul 09, 2025 10:17AM ET
Investing.com - KeyBanc has reiterated its Overweight rating on Paylocity Holding (NASDAQ:PCTY), currently trading at $185.13, with a price target of $220.00. According to InvestingPro data, analyst consensus remains bullish with targets ranging from $142 to $270, suggesting potential upside from current levels.
The firm believes workforce levels have remained stable and potentially exceeded Paylocity's own expectations, suggesting the possibility of the company beating its fourth fiscal quarter forecasts. The company has maintained impressive gross profit margins of 68.8% and generated robust revenue growth of 14.6% over the last twelve months.
KeyBanc noted that Paylocity has been taking a conservative approach to guidance, with a framework that investors generally understand well, particularly regarding fiscal year 2026 projections.
The investment bank expects Paylocity's initial fiscal year 2026 recurring revenue growth guidance will likely come in lower than current Wall Street estimates, which are in the 9-10% range.
KeyBanc indicated this conservative outlook is likely already anticipated by investors, and the firm has reduced its own out-year estimates to align with what it describes as the company's "prudent guidance framework."
In other recent news, Paylocity Holding Corp. reported strong financial results for the third quarter of 2025, surpassing Wall Street expectations. The company achieved an earnings per share of $2.43, exceeding the projected $2.13, and reported revenue of $454.55 million, which also surpassed the forecasted $442 million. This performance reflects a 13% year-over-year revenue increase, with notable growth driven by the broker channel and continued investment in AI and product innovation. Analysts from Stifel have maintained a Buy rating on Paylocity, setting a price target of $235, despite adjusting their subscription revenue growth forecast for fiscal year 2026 to 8.7%, down from an earlier estimate of around 10%. Stifel anticipates minimal impact on Paylocity's profitability, projecting a modest increase in core margins while operating margins may decline slightly. The integration of Airbase into Paylocity's offerings is progressing well, with positive early signs, suggesting potential competitive differentiation in managing payroll and non-payroll related spend. Paylocity's outlook for fiscal year 2025 remains optimistic, with projected recurring revenue growth of 14% and total revenue expected to reach between $1.580 billion and $1.585 billion.
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