Paylocity Price Target Boosted to $225 by KeyBanc: A Financial Analysis

KeyBanc has raised Paylocity's (PCTY) price target to $225 and maintained an Overweight rating. This decision comes after Paylocity reported impressive Q4 performance, surpassing expectations in revenue and earnings, and expanding its client base by 7% over the past year. KeyBanc is confident that Paylocity's management effectively communicated conservative assumptions for FY26 guidance, which is likely to be perceived optimistically. Paylocity offers a cloud-based human capital management and payroll platform tailored for midmarket customers, generating over $1.4 billion in revenue and serving more than 39,000 customers.

Paylocity Holding Corporation (PCTY), a leading provider of cloud-based payroll and human-resources software services, has seen its stock price target raised to $225 by KeyBanc, with the firm maintaining an Overweight rating. This decision follows Paylocity's impressive Q4 performance, where the company reported earnings of $1.56 per share, surpassing the Zacks Consensus Estimate of $1.38 per share [1]. Additionally, Paylocity expanded its client base by 7% over the past year, further bolstering its financial performance.

KeyBanc's analysts were particularly impressed with Paylocity's ability to communicate conservative assumptions for FY26 guidance, which they believe will be perceived positively by investors. Paylocity's platform, tailored for midmarket customers, generated over $1.4 billion in revenue and served more than 39,000 customers during the quarter ended June 2025.

In Q4, Paylocity's revenue reached $400.74 million, surpassing the Zacks Consensus Estimate by 3.10% [1]. This marks the company's fourth consecutive quarter of beating consensus revenue estimates. The company's earnings beat also reflects a strong performance, with adjusted earnings per share (EPS) of $1.56, a 12.7% increase over the consensus estimate of $1.38 [2].

Looking ahead, Paylocity's management has provided guidance for the upcoming quarters, which includes revenue expectations and earnings estimates. While the company has faced some challenges in the past year, with shares losing about 8% since the beginning of the year, the recent earnings report and guidance suggest a potential turnaround in investor sentiment.

KeyBanc's decision to raise the price target and maintain an Overweight rating underscores the firm's confidence in Paylocity's growth prospects and management's ability to navigate the competitive landscape. As the company continues to expand its client base and improve its offerings, investors should keep an eye on future earnings reports and guidance to gauge the stock's potential for further growth.

References:
[1] https://www.nasdaq.com/articles/paylocity-pcty-q4-earnings-and-revenues-beat-estimates
[2] https://finance.yahoo.com/news/paylocity-nasdaq-pcty-exceeds-q2-214651790.html