Paycom SoftwareHAM:0PY +2.57%71 Return-on-Tangible-Equity is 53.07% as of Mar. 2026, which is 57% above its 10-year median of 33.87. GuruFocus rates HAM:0PY with a GF Score™ of 71/100 and a GF Value™ of €217.18 (Significantly Undervalued). The stock has 3 warning signs investors should review. Among 2,466 Software companies, Paycom Software ranks better than 77.09% on this metric.
Return-on-Tangible-Equity is calculated as Net Income divided by its average total shareholder tangible equity. Total shareholder tangible equity equals to Total Stockholders Equity minus Intangible Assets. Paycom Software's annualized net income for the quarter that ended in Mar. 2026 was €539 Mil. Paycom Software's average shareholder tangible equity for the quarter that ended in Mar. 2026 was €1,015 Mil. Therefore, Paycom Software's annualized Return-on-Tangible-Equity for the quarter that ended in Mar. 2026 was 53.07%.
The historical rank and industry rank for Paycom Software's Return-on-Tangible-Equity or its related term are showing as below:
HAM:0PY'
s Return-on-Tangible-Equity Range Over the Past 10 Years
Min: 26.61 Med: 33.87 Max: 133.24
Current: 32.13
During the past 13 years, Paycom Software's highest Return-on-Tangible-Equity was 133.24%. The lowest was 26.61%. And the median was 33.87%.
HAM:0PY's Return-on-Tangible-Equity is ranked better than 77.09% of 2466
companies
in the Software industry
Industry Median: 8.67
vs HAM:0PY: 32.13
Return-on-Tangible-Equity measures the rate of return on the ownership interest (shareholder's tangible equity) of the common stock owners. It measures a firm's efficiency at generating profits from every unit of shareholders' tangible equity (shareholders equity minus intangibles). Return-on-Tangible-Equity shows how well a company uses investment funds to generate earnings growth. Return-on-Tangible-Equitys between 15% and 20% are considered desirable.
Be Aware
Net Income is used.
Because a company can increase its Return-on-Tangible-Equity by having more financial leverage, it is important to watch the leverage ratio when investing in high Return-on-Tangible-Equity companies. Like Return-on-Tangible-Asset, Return-on-Tangible-Equity is calculated with only 12 months data. Fluctuations in company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.
Asset light businesses require very few assets to generate very high earnings. Their Return-on-Tangible-Equitys can be extremely high.
Paycom Software Return-on-Tangible-Equity Related Terms
Paycom Software Return-on-Tangible-Equity Historical Data
* Premium members only.
The historical data trend for Paycom Software's Return-on-Tangible-Equity 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.
HAM:0PY vs ESTC, CVLT, NAVN: Return-on-Tangible-Equity Comparison
For the Software - Application subindustry, Paycom Software's Return-on-Tangible-Equity, along with its competitors' market caps and Return-on-Tangible-Equity 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 Return-on-Tangible-Equity vs Software Industry
For the Software industry and Technology sector, Paycom Software's Return-on-Tangible-Equity distribution charts can be found below:
* The bar in red indicates where Paycom Software's Return-on-Tangible-Equity 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.
In the calculation of annual Return-on-Tangible-Equity, the net income of the last fiscal year and the average total shareholder tangible equity over the fiscal year are used. In calculating the quarterly data,
the net income data used here is four times the quarterly (Mar. 2026) net income data.
Return-on-Tangible-Equity is displayed in the 10-year financial page.
What does a Return-on-Tangible-Equity of 53.07% mean?
Paycom Software (HAM:0PY) has a Return-on-Tangible-Equity of 53.07% as of Mar. 2026. Return on tangible equity is the ratio of current-period net income to average two-period tangible equity. View historical data on Paycom Software and its competitors. This is 57% above median its historical median of 33.87. Over the past decade, Paycom Software's Return-on-Tangible-Equity has ranged from 26.61 to 133.24. According to the industry distribution chart, Paycom Software ranks #565 out of 2466 companies in the Software industry, placing it in the top 22.9%.
Is Paycom Software's Return-on-Tangible-Equity too high?
Paycom Software's current Return-on-Tangible-Equity of 53.07% is 57% above median its 10-year median of 33.87. Over the past 10 years, this metric has ranged from a low of 26.61 to a high of 133.24. The Software industry median Return-on-Tangible-Equity is 8.67. Paycom Software's value of 53.07% is 512.1% above this industry median. Based on the distribution chart, Paycom Software ranks #565 out of 2466 companies in the Software industry, which is in the top quartile — a strong position relative to peers. Overall, Paycom Software has a GF Score™ of 71/100 and is considered Significantly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Paycom Software's Return-on-Tangible-Equity compare to ESTC and CVLT?
According to the Software industry distribution chart, Paycom Software ranks #565 out of 2466 companies for Return-on-Tangible-Equity. This places Paycom Software in the top 23% of its industry — outperforming the majority of peers. The industry median Return-on-Tangible-Equity is 8.67. Paycom Software's value of 53.07% is 512.1% above this benchmark. Historically, Paycom Software's own Return-on-Tangible-Equity has ranged from 26.61 to 133.24 over the past decade. While the company's 10-year median is 33.87 vs. the industry median of 8.67, Paycom Software 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 Return-on-Tangible-Equity for a Software company?
The median Return-on-Tangible-Equity among Software companies is 8.67, based on 2,466 companies in the industry. Companies in the top quartile (top 25%) have a Return-on-Tangible-Equity significantly above this median, while those in the bottom quartile fall well below. However, Return-on-Tangible-Equity should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Paycom Software's current Return-on-Tangible-Equity of 53.07% is 512.1% 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 Return-on-Tangible-Equity mean?
A high Return-on-Tangible-Equity can signal that a stock is expensive relative to its fundamentals. Return on tangible equity is the ratio of current-period net income to average two-period tangible equity. View historical data on Paycom Software and its competitors. For the Software industry, the median Return-on-Tangible-Equity is 8.67 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Paycom Software's current Return-on-Tangible-Equity is 53.07%, which is 57% above median its own 10-year median of 33.87. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Paycom Software stock overvalued right now?
Based on GuruFocus' analysis, Paycom Software (HAM:0PY) is currently considered Significantly Undervalued. The stock's GF Value™ is €217.18, compared to a current price of €125.65 — trading 42.1% below its estimated fair value. The current Return-on-Tangible-Equity is 53.07%, which is 57% above median its 10-year median of 33.87 and 512.1% above the Software industry median of 8.67. Paycom Software'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 Return-on-Tangible-Equity calculated?
Return-on-Tangible-Equity is calculated from a company's financial statements. For Paycom Software (HAM:0PY), the current Return-on-Tangible-Equity is 53.07% 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 Paycom Software (HAM:0PY) Overvalued in 2026?
Based on GuruFocus' analysis, Paycom Software stock appears to be undervalued.
The current stock price of €125.65 is trading 42.1% below its estimated GF Value™ of €217.18.
GuruFocus considers Paycom Software to be Significantly Undervalued.
Key valuation signals for HAM:0PY:
Return-on-Tangible-Equity: 53.07% (57% above median its 10-year median of 33.87)
GF Value™: €217.18 vs. price of €125.65 (42.1% below fair value)
Industry Position: 512.1% above the Software median (#565 of 2466)
No single metric tells the full story. See the HAM:0PY stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Founded in 1998, Paycom is a human capital management software-as-a-service provider addressing customer requirements surrounding payroll, talent acquisition, talent management, HR management, as well as time and labor. The company services businesses of all sizes within the United States and internationally. The company primarily generates revenue through the sale of subscriptions providing access to its HCM platform. To a lesser extent, the company also generates revenue from implementation services provided to customers as well as interest income generated from customer funds. As of fiscal 2024, the company serviced slightly over 37,500 customers and stored data on over 7 million employees.
71GF Score
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