6) Paycor HCM, Inc. (NASDAQ:PYCR)
Share Price as of September 20: $14.02
Short % of Float (As of August 30): 12.28%
Number of Hedge Fund Holders: 20
Paycor HCM, Inc. (NASDAQ:PYCR) is engaged in the provision of human capital management (HCM) solutions for small and medium-sized businesses (SMBs) mainly in the US. Paycor AI Smart Sourcing helps in reducing time-to-hire by sourcing both active candidates and passive candidates.
The short sellers anticipate the challenging environment for Paycor HCM, Inc. (NASDAQ:PYCR) amidst growth concerns related to the annual form filing and Employee Retention Tax Credit (ERTC) revenues. They believe that, over the near term, the company might face headwinds due to the uncertain macroeconomic environment and recent changes in its sales organization. As a result of pressure from form filings, Paycor HCM, Inc. (NASDAQ:PYCR) is expecting a gross profit margin decline moving forward. Moreover, revenue growth is anticipated to decelerate in 2025 primarily because of a slowdown in interest income and macroeconomic factors.
On the other hand, Wall Street believes that Paycor HCM, Inc. (NASDAQ:PYCR) should be aided by its embedded HCM offering, which might double in revenue contribution in FY 2025. Moreover, the company remains optimistic and continues to expect margin expansion and ongoing growth in the embedded channel. Notably, new partnerships should contribute to growth in 2025.
Paycor HCM, Inc. (NASDAQ:PYCR)’s growth strategy consists of expanding its charge per employee per month and increasing platform users. As per Wall Street, it is well-placed to capture increased market share from regional service bureaus and legacy providers in the cloud payroll industry. The company’s optimistic outlook is supported by its focus on innovation and customer satisfaction, mainly via AI and new partnerships. Experts believe that there are significant opportunities in the HCM market, and Paycor HCM, Inc. (NASDAQ:PYCR) should be able to capture those considering its focus on product portfolio expansion and cross-selling efforts.
As per Wall Street analysts, the shares of Paycor HCM, Inc. (NASDAQ:PYCR) have an average price target of $17.75. Paycor HCM, Inc. (NASDAQ:PYCR) was a part of 20 hedge fund portfolios at the end of 2Q 2024.
Conestoga Capital Advisors, an asset management company, released its second-quarter 2024 investor letter. Here is what the fund said:
“Paycor HCM, Inc. (NASDAQ:PYCR): PYCR faced challenges this quarter, stemming from a now-reversed sales force restructuring and lowered guidance due to pressure on existing customer seat usage. Despite these setbacks, the demand for modern payroll and HR solutions has remained solid, driven by increasingly complex workforce requirements. PYCR maintains a competitive edge in the market, and sales are poised to rebound in coming quarters as their sales force gains productivity. With a robust pipeline of growth opportunities and the underlying business need unchanged, Paycor is well-positioned to capitalize on the evolving HR technology landscape.”
