Why Paycom Software Is in a League of Its Own
Paycom Software's (NYSE: PAYC) revenue growth over the past several years has been dramatic -- increasing by 40% or more annually from 2013 to 2016. The company's ability to manage costs and increase its margins over the same time period have been equally impressive.
The company's preferred margin metric is adjusted EBITDA margin, a measure of operating profitability as a percentage of revenue. Paycom's adjusted EBITDA margin has steadily increased from 16.7% in 2012 to 28.7% in 2016. And it looks like this number will continue to rise. The company's latest guidance implies an adjusted EBITDA margin of around 31% for 2017. Let's examine Paycom's incredible expanding margins in the context of a couple of its peers.
Image source: Paycom Software.
Source: Fool.com
