Paylocity HoldingPCTY -2.51%71 Net Margin % is 22.15% as of Mar. 2026, which is 96% above its 10-year median of 11.31. GuruFocus rates PCTY with a GF Score™ of 71/100 and a GF Value™ of $225.43 (Possible Value Trap). The stock has 3 warning signs investors should review. Among 2,825 Software companies, Paylocity Holding ranks better than 84.5% on this metric.
The historical rank and industry rank for Paylocity Holding's Net Margin % or its related term are showing as below:
PCTY'
s Net Margin % Range Over the Past 10 Years
Min: -1.67 Med: 11.31 Max: 14.94
Current: 14.94
PCTY's Net Margin % is ranked better than 84.5% of 2825
companies
in the Software industry
Industry Median: 2.54
vs PCTY: 14.94
Paylocity Holding (NAS:PCTY) Net Margin % Explanation
Although Net Income and Earnings-per-Share (EPS) are the most widely used parameter in measuring a company's profitability and valuation, it is the least reliable. The reason is that reported earnings can be manipulated easily by adjusting any numbers such as Depreciation, Depletion and Amotorization and non-recurring items.
But the long term trend of the net margin is a good indicator of the competitiveness and health of the business.
Paylocity Holding Net Margin % Related Terms
Paylocity Holding Net Margin % Historical Data
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The historical data trend for Paylocity Holding's Net Margin % 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.
For the Software - Application subindustry, Paylocity Holding's Net Margin %, along with its competitors' market caps and Net Margin % 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.
Paylocity Holding Net Margin % vs Software Industry
For the Software industry and Technology sector, Paylocity Holding's Net Margin % distribution charts can be found below:
* The bar in red indicates where Paylocity Holding's Net Margin % falls into.
* 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.
Paylocity Holding (PCTY) has a Net Margin % of 22.15% as of Mar. 2026. Net margin is the ratio of total net income to net sales. View historical data on Paylocity Holding and its competitors. This is 96% above median its historical median of 11.31. According to the industry distribution chart, Paylocity Holding ranks #438 out of 2825 companies in the Software industry, placing it in the top 15.5%.
Is Paylocity Holding's Net Margin % too high?
Paylocity Holding's current Net Margin % of 22.15% is 96% above median its 10-year median of 11.31. The Software industry median Net Margin % is 2.54. Paylocity Holding's value of 22.15% is 772% above this industry median. Based on the distribution chart, Paylocity Holding ranks #438 out of 2825 companies in the Software industry, which is in the top quartile — a strong position relative to peers. Overall, Paylocity Holding has a GF Score™ of 71/100 and is considered Possible Value Trap, reflecting its overall financial health beyond just this single metric.
How does Paylocity Holding's Net Margin % compare to PEGA and PAYC?
According to the Software industry distribution chart, Paylocity Holding ranks #438 out of 2825 companies for Net Margin %. This places Paylocity Holding in the top 16% of its industry — outperforming the majority of peers. The industry median Net Margin % is 2.54. Paylocity Holding's value of 22.15% is 772% above this benchmark. While the company's 10-year median is 11.31 vs. the industry median of 2.54, Paylocity Holding has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Net Margin % for a Software company?
The median Net Margin % among Software companies is 2.54, based on 2,825 companies in the industry. Companies in the top quartile (top 25%) have a Net Margin % significantly above this median, while those in the bottom quartile fall well below. However, Net Margin % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Paylocity Holding's current Net Margin % of 22.15% is 772% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Net Margin % mean?
A high Net Margin % can signal that a stock is expensive relative to its fundamentals. Net margin is the ratio of total net income to net sales. View historical data on Paylocity Holding and its competitors. For the Software industry, the median Net Margin % is 2.54 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Paylocity Holding's current Net Margin % is 22.15%, which is 96% above median its own 10-year median of 11.31. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Paylocity Holding stock overvalued right now?
Based on GuruFocus' analysis, Paylocity Holding (PCTY) is currently considered Possible Value Trap. The stock's GF Value™ is $225.43, compared to a current price of $101.19 — trading 55.1% below its estimated fair value. The current Net Margin % is 22.15%, which is 96% above median its 10-year median of 11.31 and 772% above the Software industry median of 2.54. Paylocity Holding's overall GF Score™ is 71/100 with 3 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Net Margin % calculated?
Net Margin % is calculated from a company's financial statements. For Paylocity Holding (PCTY), the current Net Margin % is 22.15% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Paylocity Holding (PCTY) Overvalued in 2026?
Based on GuruFocus' analysis, Paylocity Holding stock appears to be undervalued.
The current stock price of $101.19 is trading 55.1% below its estimated GF Value™ of $225.43.
GuruFocus considers Paylocity Holding to be Possible Value Trap.
Key valuation signals for PCTY:
Net Margin %: 22.15% (96% above median its 10-year median of 11.31)
GF Value™: $225.43 vs. price of $101.19 (55.1% below fair value)
Industry Position: 772% above the Software median (#438 of 2825)
No single metric tells the full story. See the PCTY stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Paylocity is a cloud-based human capital management provider offering payroll, compliance, and human resources management solutions. With the addition of expense and IT management modules, Paylocity unifies back-office operations spanning HR, finance, and IT on a single platform and bills customers on a subscription basis. The firm's customer base skews toward the midmarket and is primarily based in the US. As of fiscal 2025, Paylocity has nearly 42,000 customers.
71GF Score
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