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Paycom Software (NYSE:PAYC) Interest Coverage

: 401.21 (As of Dec. 2023)
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Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income by its Interest Expense. Paycom Software's Operating Income for the three months ended in Dec. 2023 was $107 Mil. Paycom Software's Interest Expense for the three months ended in Dec. 2023 was $-0 Mil. Paycom Software's interest coverage for the quarter that ended in Dec. 2023 was 401.21. The higher the ratio, the stronger the company's financial strength is.

Good Sign:

Ben Graham prefers companies' interest coverage to be at least 5. Paycom Software Inc has enough cash to cover all of its debt. Its financial situation is stable.

The historical rank and industry rank for Paycom Software's Interest Coverage or its related term are showing as below:

PAYC' s Interest Coverage Range Over the Past 10 Years
Min: 4.59   Med: 149.32   Max: 9795.95
Current: 234.21


PAYC's Interest Coverage is ranked better than
73.71% of 1586 companies
in the Software industry
Industry Median: 31.495 vs PAYC: 234.21

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.


Paycom Software Interest Coverage Historical Data

The historical data trend for Paycom Software's Interest Coverage can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

Note: For Interest Coverage, "No debt" indicates no long-term debt. An indication of "No Debt" does not necessarily mean that the company has no long-term debt obligations; it could be due to missing data in the quarterly or annual report. Use caution when interpreting this information.

* Premium members only.

Paycom Software Annual Data
Trend Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23
Interest Coverage
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 240.66 9,795.95 N/A 149.32 234.21

Paycom Software Quarterly Data
Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23
Interest Coverage Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 111.52 191.68 144.96 436.49 401.21

Competitive Comparison

For the Software - Application subindustry, Paycom Software's Interest Coverage, along with its competitors' market caps and Interest Coverage data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


Paycom Software Interest Coverage Distribution

For the Software industry and Technology sector, Paycom Software's Interest Coverage distribution charts can be found below:

* The bar in red indicates where Paycom Software's Interest Coverage falls into.



Paycom Software Interest Coverage Calculation

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

If Interest Expense is negative and Operating Income is positive, then

Interest Coverage=-1* Operating Income /Interest Expense

Else if Interest Expense is negative and Operating Income is negative, then

The company did not have earnings to cover the interest expense.

Else if Interest Expense is 0 and Long-Term Debt & Capital Lease Obligation is 0, then

The company had no debt (1).


Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Paycom Software's Interest Coverage for the fiscal year that ended in Dec. 2023 is calculated as

Here, for the fiscal year that ended in Dec. 2023, Paycom Software's Interest Expense was $-2 Mil. Its Operating Income was $451 Mil. And its Long-Term Debt & Capital Lease Obligation was $0 Mil.

Interest Coverage=-1* Operating Income (A: Dec. 2023 )/Interest Expense (A: Dec. 2023 )
=-1*451.322/-1.927
=234.21

Paycom Software's Interest Coverage for the quarter that ended in Dec. 2023 is calculated as

Here, for the three months ended in Dec. 2023, Paycom Software's Interest Expense was $-0 Mil. Its Operating Income was $107 Mil. And its Long-Term Debt & Capital Lease Obligation was $0 Mil.

Interest Coverage=-1* Operating Income (Q: Dec. 2023 )/Interest Expense (Q: Dec. 2023 )
=-1*106.723/-0.266
=401.21

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

The higher the ratio, the stronger the company's Financial Strength is.


Paycom Software  (NYSE:PAYC) Interest Coverage Explanation

Ben Graham requires that a company has a minimum interest coverage of 5 with the companies he invested. If the interest coverage is less than 2, the company is burdened by debt. Any business slow or recession may drag the company into a situation where it cannot pay the interest on its debt.

Interest Coverage is an important factor when GuruFocus ranks a company's overage Financial Strength .


Paycom Software Interest Coverage Related Terms

Thank you for viewing the detailed overview of Paycom Software's Interest Coverage provided by GuruFocus.com. Please click on the following links to see related term pages.


Paycom Software (NYSE:PAYC) Business Description

Traded in Other Exchanges
Address
7501 W. Memorial Road, Oklahoma, OK, USA, 73142
Paycom is a fast-growing provider of payroll and human capital management, or HCM, software primarily targeting clients with 50-10,000 employees in the United States. Paycom was established in 1998 and services about 19,000 clients as of 2022, based on parent company grouping. Alongside its core payroll software, Paycom offers various HCM add-on modules, including time and attendance, talent management, and benefits administration.
Executives
Chad R. Richison director, 10 percent owner, officer: President and CEO 7501 W. MEMORIAL ROAD, OKLAHOMA CITY OK 73142
Jason D. Clark director 7501 W. MEMORIAL ROAD, OKLAHOMA CITY OK 73142
Watts J C Jr director
Christopher Gene Thomas officer: SEVP of Operations 7501 W. MEMORIAL ROAD, OKLAHOMA CITY OK 73142
Peters Frederick C Ii director BRYN MAWR BANK CORP, 801 LANCASTER AVE, BRYN MAWR PA 19010
Holly Faurot officer: Chief Sales Officer 7501 W. MEMORIAL ROAD, OKLAHOMA CITY OK 73142
Justin Devon Long officer: EVP of Operations 7501 W. MEMORIAL ROAD, OKLAHOMA CITY OK 73142
Bradley Scott Smith officer: Chief Information Officer 7501 W. MEMORIAL ROAD, OKLAHOMA CITY OK 73142
Craig E. Boelte officer: Chief Financial Officer 7501 W. MEMORIAL ROAD, OKLAHOMA CITY OK 73142
Felicia Williams director C/O MACY'S, INC., 151 WEST 34TH STREET, NEW YORK NY 10001
Sharen J Turney director THREE LIMITED PARKWAY, COLUMBUS OH 43230
Jon Evans officer: Chief Operating Officer 7501 W. MEMORIAL ROAD, OKLAHOMA CITY OK 73142
Jeffrey D. York officer: Chief Sales Officer 7501 W. MEMORIAL ROAD, OKLAHOMA CITY OK 73142
Robert J Levenson director 300 SEMINOLE AVENUE, P.H. 6B, PALM BEACH FL 33480
Kathy Oden-hall officer: See Remarks 7501 W. MEMORIAL ROAD, OKLAHOMA CITY OK 73142