Paychex, Inc. (PAYX) vs Atlassian Corporation PLC (TEAM)

Paychex, Inc. and Atlassian Corporation PLC are both Software Application companies. Atlassian Corporation PLC is the larger, with a market value of $48.5B against $36.0B — 1.3× the size. Atlassian Corporation PLC has negative trailing earnings, so its P/E is not meaningful; Paychex, Inc. trades at 20.1×. Atlassian Corporation PLC grew revenue faster over the last twelve months: 26.0% against 14.0%. Paychex, Inc. has the higher net margin (27.4% vs −0.82%) and the higher return on invested capital (22.2% vs 0.80%). Across the 21 metrics below, Paychex, Inc. leads on 15 and Atlassian Corporation PLC on 6.

Valuation

Metric PAYX TEAM Software Application median
P/E 20.08 n/m 24.79
P/S 5.46 7.43 2.67
P/B 9.73 46.15 3.01
Price to free cash flow 17.88 37.16 16.59
EV/EBITDA 12.53 322.09 14.40
EV/Sales 6.06 7.40 2.62
Earnings yield 4.98% (0.10%) 0.00%
Free cash flow yield 5.59% 2.69% 1.91%

Profitability

Metric PAYX TEAM Software Application median
Gross margin 74.39% 84.83% 67.03%
Operating margin 39.19% 0.16% 0.00%
Net margin 27.35% (0.82%) 0.00%
Free cash flow margin 30.54% 20.07% 4.32%
Return on equity 47.06% (4.48%) 0.00%
Return on assets 11.17% (0.89%) 0.00%
Return on invested capital 22.23% 0.80% 0.00%

Growth

Metric PAYX TEAM Software Application median
Revenue growth (TTM) 13.97% 26.02% 12.40%
EPS growth (last fiscal year) 6.77% 78.57% —
Revenue growth, 5-year CAGR 9.93% 25.76% 13.72%
Net income growth, 5-year CAGR 9.91% 0.00% 0.00%

Health

Metric PAYX TEAM Software Application median
Debt to equity 1.23 0.93 0.02
Current ratio 1.28 0.78 1.55
Net debt to EBITDA 1.06 (1.66) 0.06

Dividend

Metric PAYX TEAM Software Application median
Dividend yield 2.84% — 1.25%
Payout ratio 0.76 0.00 0.00

Size

Metric PAYX TEAM Software Application median
Market cap 36.03b 48.48b 396.11m

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