As the Q3 earnings season comes to a close, it’s time to take stock of this quarter’s best and worst performers in the HR software industry, including Dayforce (NYSE:DAY) and its peers.

Modern HR software has two powerful benefits: cost savings and ease of use. For cost savings, businesses large and small much prefer the flexibility of cloud-based, web-browser-delivered software paid for on a subscription basis rather than the hassle and complexity of purchasing and managing on-premise enterprise software. On the usability side, the consumerization of business software creates seamless experiences whereby multiple standalone processes like payroll processing and compliance are aggregated into a single, easy-to-use platform.

The 6 HR software stocks we track reported a mixed Q3. As a group, revenues were in line with analysts’ consensus estimates while next quarter’s revenue guidance was 1.7% below.

Thankfully, share prices of the companies have been resilient as they are up 7% on average since the latest earnings results.

Dayforce (NYSE:DAY)

Founded in 1992 as Ceridian, an outsourced payroll processor and transformed after the 2012 acquisition of Dayforce, Dayforce (NYSE:DAY) is a provider of cloud based payroll and HR software targeted at mid-sized businesses.

Dayforce reported revenues of $440 million, up 16.6% year on year. This print exceeded analysts’ expectations by 2.7%. Despite the top-line beat, it was still a mixed quarter for the company with an impressive beat of analysts’ EBITDA estimates.

“Our dedicated team achieved excellent results in the third quarter, positioning us to finish 2024 with strength,” said David Ossip, Chair and CEO of Dayforce.

Interestingly, the stock is up 12.9% since reporting and currently trades at $73.75.

Read our full report on Dayforce here, it’s free.

Best Q3: Paycor (NASDAQ:PYCR)

Found in 1990 in Cincinnati, Ohio, Paycor (NASDAQ: PYCR) provides software for small businesses to manage their payroll and HR needs in one place.

Paycor reported revenues of $167.5 million, up 16.6% year on year, outperforming analysts’ expectations by 3.3%. The business had a strong quarter with an impressive beat of analysts’ EBITDA estimates and an impressive beat of analysts’ billings estimates.

Paycor achieved the biggest analyst estimates beat and fastest revenue growth among its peers. Although it had a fine quarter compared its peers, the market seems unhappy with the results as the stock is down 1.5% since reporting. It currently trades at $16.42.

Is now the time to buy Paycor? Access our full analysis of the earnings results here, it’s free.

Weakest Q3: Asure (NASDAQ:ASUR)

Created from the merger of two small workforce management companies in 2007, Asure (NASDAQ:ASUR) provides cloud based payroll and HR software for small and medium-sized businesses (SMBs).

Asure reported revenues of $29.3 million, flat year on year, falling short of analysts’ expectations by 6.5%. It was a disappointing quarter as it posted revenue guidance for next quarter missing analysts’ expectations significantly and a significant miss of analysts’ EBITDA estimates.

Asure delivered the weakest performance against analyst estimates, slowest revenue growth, and weakest full-year guidance update in the group. As expected, the stock is down 13.6% since the results and currently trades at $8.58.

Read our full analysis of Asure’s results here.

Paychex (NASDAQ:PAYX)

One of the oldest service providers in the industry, Paychex (NASDAQ:PAYX) offers its customers payroll and HR software solutions.

Paychex reported revenues of $1.32 billion, up 2.5% year on year. This result met analysts’ expectations. Overall, it was a satisfactory quarter as it also produced a decent beat of analysts’ EBITDA estimates.

The stock is up 5.6% since reporting and currently trades at $141.67.

Read our full, actionable report on Paychex here, it’s free.

Paycom (NYSE:PAYC)

Founded in 1998 as one of the first online payroll companies, Paycom (NYSE:PAYC) provides software for small and medium-sized businesses (SMBs) to manage their payroll and HR needs in one place.

Paycom reported revenues of $451.9 million, up 11.2% year on year. This number surpassed analysts’ expectations by 1.1%. It was a strong quarter as it also put up an impressive beat of analysts’ EBITDA estimates and full-year EBITDA guidance exceeding analysts’ expectations.

The stock is up 28.8% since reporting and currently trades at $221.99.

Read our full, actionable report on Paycom here, it’s free.

Market Update

In response to the Fed's rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed's 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.

Want to invest in winners with rock-solid fundamentals? Check out our Hidden Gem Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.

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