Return on Retained Earnings (RORE) is an indicator of a company's growth potential, it shows how much a company earns by reinvesting its retained earnings, i.e. profits after dividend payments.
Paylocity Holding's 3-Year RORE % for the quarter that ended in Mar. 2026 was 10.30%.
The industry rank for Paylocity Holding's 3-Year RORE % or its related term are showing as below:
PCTY's 3-Year RORE % is ranked better than 58.17% of 2541
companies
in the Software industry
Industry Median: 2.73
vs PCTY: 10.30
Return on Retained Earnings (RORE) is important to investors because it reveals a company's efficiency and growth potential. A higher RORE indicates a higher return. A high RORE indicates that the company should reinvest profits into the business. A lower RORE suggests that the company should distribute profits to shareholders by paying out dividends, since those dollars aren't generating much additional growth for the company.
There are a several different ways to arrive at the Return on Retained Earnings. The simplest way to calculate it is by using published information on Earnings per Share (EPS) and Dividend per Share (DPS) over a selected period. Here, 3-year period is chosen.
Be Aware
Please keep in mind that the RORE is relative to the nature of the business and its competitors. If another company in the same sector is producing a lower return on retained earnings, it doesn’t necessarily mean it’s a bad investment. It may just suggest the company is older and no longer in a high growth stage. At such a stage in the business cycle, it would be expected to see a lower RORE and higher dividend payout.
Paylocity Holding 3-Year RORE % Related Terms
Paylocity Holding 3-Year RORE % Historical Data
* Premium members only.
The historical data trend for Paylocity Holding's 3-Year RORE % 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.
PCTY vs DUOL, NAVN, CVLT: 3-Year RORE % Comparison
For the Software - Application subindustry, Paylocity Holding's 3-Year RORE %, along with its competitors' market caps and 3-Year RORE % 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 3-Year RORE % vs Software Industry
For the Software industry and Technology sector, Paylocity Holding's 3-Year RORE % distribution charts can be found below:
* The bar in red indicates where Paylocity Holding's 3-Year RORE % 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 3-Year RORE %, the most recent and first period EPS (Diluted) is the trailing twelve months (TTM) data ended in Mar. 2026 and 3-year before.
Paylocity Holding (PCTY) has a 3-Year RORE % of 10.30 as of Mar. 2026. 3-Year RORE % shows how much a company earns by reinvesting its retained earnings in 3-year. View historical data on Paylocity Holding and its competitors. According to the industry distribution chart, Paylocity Holding ranks #1063 out of 2541 companies in the Software industry, placing it in the top 41.8%.
Is Paylocity Holding's 3-Year RORE % too high?
Paylocity Holding's current 3-Year RORE % is 10.30. The Software industry median 3-Year RORE % is 2.73. Paylocity Holding's value of 10.30 is 277.3% above this industry median. Based on the distribution chart, Paylocity Holding ranks #1063 out of 2541 companies in the Software industry, which is above the industry midpoint. Overall, Paylocity Holding has a GF Score™ of 75/100 and is considered Possible Value Trap, reflecting its overall financial health beyond just this single metric.
How does Paylocity Holding's 3-Year RORE % compare to DUOL and NAVN?
According to the Software industry distribution chart, Paylocity Holding ranks #1063 out of 2541 companies for 3-Year RORE %. This puts Paylocity Holding in the upper half of its industry. The industry median 3-Year RORE % is 2.73. Paylocity Holding's value of 10.30 is 277.3% above this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good 3-Year RORE % for a Software company?
The median 3-Year RORE % among Software companies is 2.73, based on 2,541 companies in the industry. Companies in the top quartile (top 25%) have a 3-Year RORE % significantly above this median, while those in the bottom quartile fall well below. However, 3-Year RORE % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Paylocity Holding's current 3-Year RORE % of 10.30 is 277.3% 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 3-Year RORE % mean?
A high 3-Year RORE % can signal that a stock is expensive relative to its fundamentals. 3-Year RORE % shows how much a company earns by reinvesting its retained earnings in 3-year. View historical data on Paylocity Holding and its competitors. For the Software industry, the median 3-Year RORE % is 2.73 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Paylocity Holding's current 3-Year RORE % is 10.30. 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 $226.07, compared to a current price of $115.10 — trading 49.1% below its estimated fair value. The current 3-Year RORE % is 10.30 and 277.3% above the Software industry median of 2.73. Paylocity Holding's overall GF Score™ is 75/100 with 3 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is 3-Year RORE % calculated?
3-Year RORE % is calculated from a company's financial statements. For Paylocity Holding (PCTY), the current 3-Year RORE % is 10.30 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 $115.10 is trading 49.1% below its estimated GF Value™ of $226.07.
GuruFocus considers Paylocity Holding to be Possible Value Trap.
Key valuation signals for PCTY:
3-Year RORE %: 10.30
GF Value™: $226.07 vs. price of $115.10 (49.1% below fair value)
Industry Position: 277.3% above the Software median (#1063 of 2541)
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.
75GF Score
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