Pacific Crest Starts Paylocity Holding (PCTY) at Sector Weight

Pacific Crest initiates coverage on Paylocity Holding (NASDAQ: PCTY) with a Sector Weight rating. Analyst Trevor Upton sees upside as limited.

"Paylocity is a leading provider of payroll and HCM to SMBs and is taking share from legacy payroll vendors. We see upside to estimates, which are too conservative, in our view. However, with near-term risks around F2Q17 guidance and ACA exposure, we think upside could be limited in the near term," said Upton.

The analyst added, "We expect Paylocity to continue to grow revenue and expand margins. Its planned launch of the recruiting module in early C2017 should benefit growth. We think investors should own the shares at market weight, but we see risk around ACA seasonality and exposure in the near term. We think investors can be patient with shares trading near PCTY's average EV/S multiple."

For an analyst ratings summary and ratings history on Paylocity Holding click here. For more ratings news on Paylocity Holding click here.

Shares of Paylocity Holding closed at $41.47 yesterday.

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