What Happened?

Shares of online payroll and human resource software provider Dayforce (NYSE:DAY) jumped 11.8% in the morning session after the company reported a "beat and raise" quarter. Third-quarter earnings beat analysts' revenue, billing, and EPS expectations. The solid performance enabled the company to raise sales and EBITDA guidance for the full year. Overall, this was a strong quarter.

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What The Market Is Telling Us

Dayforce’s shares are not very volatile and have only had 7 moves greater than 5% over the last year. Moves this big are rare for Dayforce and indicate this news significantly impacted the market’s perception of the business. 

The biggest move we wrote about over the last year was 6 months ago when the stock dropped 10.3% on the news that the company reported first-quarter results and provided underwhelming revenue and EBITDA guidance for the next quarter, although its full-year outlook remained intact. Similarly, revenue and EPS came in narrowly ahead of expectations during the quarter. Notably, the forward growth forecast implied a deceleration (FY'24 revenue growth in the mid-teens vs. 22% growth in the previous year). Overall, it was a weaker quarter for the company.

Dayforce is up 7.3% since the beginning of the year, and at $70.78 per share, it is trading close to its 52-week high of $73.69 from February 2024. Investors who bought $1,000 worth of Dayforce’s shares 5 years ago would now be looking at an investment worth $1,558.

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