Is PCTY's EPS growth sustainable beyond Q3 2025?

**Paylocity Holding's (PCTY) EPS growth appears to be sustainable beyond Q3 2025**, based on several key points:

1. **Consistent Growth History**: PCTY has demonstrated a strong track record of EPS growth, with a compound annual growth rate (CAGR) of 30% per year over the past five years. This consistent growth indicates a solid business foundation and suggests that the company's profitability trends are likely to continue.
2. **Future Revenue Forecasts**: The company's revenue is forecasted to grow at an average annual rate of 9.2% over the next three years, which is a positive indicator for EPS growth. As revenue increases, it typically leads to higher net income and, consequently, higher EPS, assuming the company maintains its current profitability levels.
3. **Market Sentiment and Adjustments**: While the market has been somewhat cautious recently, as evidenced by a 9.1% drop in the share price over the past year, the underlying fundamentals of the company suggest that the EPS growth could be sustainable. The market's pessimism may not necessarily reflect the company's actual performance, as seen in the discrepancy between EPS growth and share price gains.
4. **Financial Metrics Improvement**: PCTY has improved its bottom line over the last three years, with a notable 34% EPS growth per year compound over three years. This improvement in profitability is a positive sign for future EPS growth sustainability.
5. **Balance Sheet Strength**: The company's balance sheet has strengthened over time, which is crucial for sustaining EPS growth. A strong balance sheet can support the company's operations, investments, and financial flexibility, all of which are essential for long-term profitability.

In conclusion, while short-term market dynamics may influence PCTY's stock price, the company's solid financial performance, growth history, and positive future forecasts suggest that its EPS growth is likely to be sustainable beyond Q3 2025.