Is Paycom Software, Inc. overvalued or undervalued?

As of 7 May 2025, Paycom Software, Inc. has moved from an attractive to a fair valuation grade. The company is currently fairly valued, with a P/E ratio of 42, a Price to Book Value of 9.61, and an EV to EBITDA of 20.75. In comparison to its peers, PTC, Inc. is considered expensive with a P/E of 45.58, while Zoom Video Communications, Inc. is attractive with a P/E of 22.48.
Despite the recent decline in stock performance, where Paycom's 1-month return is -9.67% compared to the S&P 500's 3.83%, the company still shows strong fundamentals with a ROCE of 43.83% and a ROE of 22.96%. Overall, while the valuation has softened, Paycom remains fairly valued in the current market context.