Investment Manager Doubles Down on Paycom, Acquires $95 Million Worth of Shares
Key Points
Reinhart Partners added 537,726 shares of Paycom, with the estimated trade valued at $95.28 million based on average prices in the quarter.
The quarter-end value of the position increased by $82.74 million, reflecting both share additions and price movement.
After the trade, the fund held 598,323 shares valued at $95.35 million.
This stake accounts for 2.9% of AUM, placing it outside the fund's top five holdings.
On February 10, 2026, Reinhart Partners disclosed a significant buy of Paycom (NYSE:PAYC), adding 537,726 shares in a transaction estimated at $95.28 million based on quarterly average pricing.
What Happened
According to an SEC filing dated February 10, 2026, Reinhart Partners increased its holding in Paycom by 537,726 shares. The estimated transaction value was $95.28 million, based on the average closing price during the quarter. At quarter-end, the value of the stake rose by $82.74 million compared to the prior period, a figure that includes both the impact of share purchases and market price changes.
What Else to Know
The move was a buy, resulting in Paycom accounting for 2.9% of the fund’s reportable assets as of December 31, 2025.
Top holdings after the filing:
- NASDAQ: FCNCA: $167.04 million (5.0% of AUM)
- NASDAQ: SIMO: $145.85 million (4.4% of AUM)
- NYSE: YETI: $134.08 million (4.0% of AUM)
- NASDAQ: IDCC: $132.97 million (4.0% of AUM)
- NASDAQ: ACLS: $127.73 million (3.8% of AUM)
As of February 10, 2026, shares were priced at $124.94, down 38.5% over the past year and trailing the S&P 500 by 53.0 percentage points.
Company Overview
| Metric | Value |
|---|---|
| Revenue (TTM) | $2.00 billion |
| Net income (TTM) | $453.20 million |
| Dividend yield | 1.3% |
Company Snapshot
- Provides cloud-based human capital management (HCM) solutions, including payroll, talent acquisition, time and labor management, and analytics applications.
- Operates a software-as-a-service (SaaS) business model, generating recurring revenue from subscription fees for its suite of integrated HCM tools.
- Serves small to mid-sized businesses in the United States seeking comprehensive workforce management and compliance solutions.
Paycom provides cloud-based HCM software delivered through a SaaS model, offering end-to-end workforce management solutions for small to mid-sized businesses in the United States.
What This Transaction Means For Investors
Reinhart Partners, a Wisconsin-based investment management firm, acquired approximately $95 million worth of Paycom shares during the fourth quarter (the three months ending on Dec. 31, 2025). Here’s what investors should take away from this transaction.
First off, it’s important to contextualize this purchase. Paycom shares have been in steady decline for several years. Indeed, since 2021, Paycom stock has fallen by roughly 70%. While there are many reasons for this slide, the biggest has to be the emergence of artificial intelligence (AI).
Many analysts are concerned that AI will serve as a replacement to many ‘off-the-shelf’ software products — particularly in the field of payroll and human resources. That would be a major problem for Paycom, whose business model revolves around the sale of such products. What’s more, the concern isn’t simply theoretical. Paycom’s revenue growth has slowed from 30% in 2021 to under 10% in 2025.
That’s not to say that Paycom stock can’t bounce back. However, given the rapid development of AI, SaaS companies like Paycom remain at risk. While Paycom stock could be the right choice for investors betting on a turnaround, average investors may be wise to consider these tech stocks to watch in 2026.
Jake Lerch has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Paycom Software. The Motley Fool recommends Yeti. The Motley Fool has a disclosure policy.