Paycom Software, Inc. (PAYC)

Paycom Software is widely considered to be the first fully online payroll service provider. The company offers a variety of cloud-based human capital management solutions. Paycom’s expanding set of services may eventually become critical for its customers’ operations and create stickiness as a result. Paycom is ranked as one of the fastest-growing companies in the US. It is poised to benefit from a shift to the cloud and to greater digitization of human resource functions. As a result, the long-term growth prospects of Paycom look bright.

The monthly long-term chart for Paycom Software shows an uptrend ever since the stock listed in 2014. The uptrend has accelerated since 2018, and prices have made higher highs and higher lows consistently except for mid-2020. A few months prior, in March 2020, the price broke the bottom of the long-term trend. It was the only time that prices went below the bottom trend line. More recently, the first three months of 2021 saw the price drop by 25% from the December 2020 high of $450. However, prices found support at the $342 level, which was previously a resistance zone in early 2020. The reversal now means that the next target is $450, and a minimum stop loss can be placed below the $342 level, near $330.

Position entered into our long-term tracking portfolio today. The entry point is $325.19, and a stop-loss placed at $270.53, which is 17 % below the entry point. The short-term to medium-term take profit at the top of the trend is set at $381.20, giving a profit of 17%.