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1. Company Snapshot

1.a. Company Description

Dayforce Inc., together with its subsidiaries, operates as a human capital management (HCM) software company in the United States, Canada, and internationally.It offers Dayforce, a cloud HCM platform that provides human resources, payroll, benefits, workforce management, and talent management functionality; and Powerpay, a cloud HR and payroll solution for the small business market.The company also provides Bureau solutions for payroll and payroll-related services.


It sells its solutions through direct sales force and third-party channels.The company was formerly known as Ceridian HCM Holding Inc.and changed its name to Dayforce Inc.


in February 2024.Dayforce Inc.was incorporated in 2013 and is headquartered in Minneapolis, Minnesota.

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1.b. Last Insights on DAY

Dayforce Inc.'s recent performance was driven by strong Q2 2025 earnings, with a 27% EPS growth and positive 2025 guidance, fueled by strong recurring revenues and margin expansion. The company's expanding clientele and strong portfolio also contributed to its solid performance. Additionally, the proposed buyout by Thoma Bravo at $70.00 per share in cash has sparked investigations into the fairness of the deal, suggesting that the company's value may be undervalued.

1.c. Company Highlights

2. Dayforce Exceeds Expectations, Raises Guidance

Dayforce delivered a solid second quarter, exceeding guidance across the board. Revenue, excluding float, grew 14% year-over-year, while adjusted EBITDA margin expanded significantly to 31.7%, a 420 basis point increase. Free cash flow reached a healthy $87.1 million, representing 18.7% of revenue. This strong performance, driven by a combination of robust sales and operational efficiency, propelled year-to-date free cash flow to $106.6 million, a 500 basis point improvement compared to the prior year.

Publication Date: Aug -09

📋 Highlights
  • Recurring Revenue & Margin Growth:: Dayforce recurring revenue grew 14% YoY in Q2, with adjusted EBITDA margin expanding 420 bps to 31.7%.
  • Free Cash Flow Surge:: Q2 free cash flow reached $87.1M (18.7% of revenue), with YTD total of $106.6M, up 500 bps YoY.
  • AI Adoption Leadership:: 80% of new business wins included AI analytics, and 60% included AI learning products in Q2.
  • Guidance Raised:: Free cash flow margin guidance increased to 13.5–14% for 2025, driven by tax benefits from the One Big Beautiful Bill Act.
  • Long-Term Target:: Company reaffirmed $1 billion in free cash flow by 2031, projecting 15% CAGR for Dayforce recurring revenue.

Momentum Fueled by Strategic Focus

The company's success can be attributed to its laser focus on its single data model platform and comprehensive HCM suite. This approach allows customers to consolidate disparate systems, streamlining operations and driving a strong return on investment. The shift towards larger enterprise clients, with Dayforce securing its largest deal to date, underscores the value proposition of its platform in managing complex HR needs.

AI Integration Drives Growth

Another key driver of growth is the successful integration of AI across the platform. With 80% of new business wins incorporating AI analytics and 60% featuring AI learning products, Dayforce is clearly capitalizing on the transformative power of AI in the HCM space. This strategic focus on innovation positions Dayforce as a leader in the evolving HR technology landscape.

Guidance Raised, Long-Term Target Remains

The company's confidence in its continued growth trajectory is reflected in its raised free cash flow margin guidance for 2025, now projected to be between 13.5% and 14%. This upward revision is driven by strong execution, scaling initiatives, and the positive impact of the One Big Beautiful Bill Act. Dayforce remains firmly committed to its long-range plan, with the ambitious goal of achieving $1 billion in free cash flow by 2031.

3. NewsRoom

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New Dayforce Report Uncovers America's Growing Retirement Divide

Nov -18

Source: globenewswire.com

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Envestnet Asset Management Inc. Buys 7,253 Shares of Dayforce, Inc. $DAY

Nov -17

Source: defenseworld.net

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Dayforce shareholders back Thoma Bravo's $12.3 billion take-private deal

Nov -12

Source: reuters.com

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Dayforce Stockholders Approve Acquisition by Thoma Bravo

Nov -12

Source: globenewswire.com

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Teacher Retirement System of Texas Grows Stock Position in Dayforce, Inc. $DAY

Nov -04

Source: defenseworld.net

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Bessemer Group Inc. Sells 3,470 Shares of Dayforce, Inc. $DAY

Nov -03

Source: defenseworld.net

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DAYFORCE SHAREHOLDER ALERT: Kaskela Law LLC Announces Investigation into Price Adequacy of Dayforce, Inc. (NYSE: DAY) Shareholder Buyout - Does $70.00 Per Share Undervalue Dayforce Shares?

Oct -31

Source: businesswire.com

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Dayforce Q3 Earnings Miss Estimates, Revenues Rise Y/Y, Shares Up

Oct -30

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (14.49%)

6. Segments

Cloud - Dayforce

Expected Growth: 15%

Dayforce's 15% growth in Cloud segment is driven by increasing adoption of HCM solutions, growing demand for digital transformation in HR, and expansion into new markets. Additionally, its user-friendly interface, real-time data analytics, and compliance with labor laws and regulations contribute to its growth.

Professional Services and Other

Expected Growth: 12%

Dayforce Inc's 12% growth in Professional Services and Other is driven by increasing adoption of cloud-based HR solutions, expansion into new markets, and strategic partnerships. Additionally, the company's focus on innovation, customer satisfaction, and retention has led to upselling and cross-selling opportunities, contributing to the segment's growth.

Cloud - Powerpay

Expected Growth: 18%

Cloud-based Powerpay from Dayforce Inc is driven by increasing adoption of HR technology, growing demand for payroll automation, and rising need for compliance with labor laws and regulations. Additionally, the shift towards cloud-based solutions, scalability, and cost-effectiveness are key growth drivers, contributing to an 18% growth rate.

Other

Expected Growth: 10%

Dayforce Inc's 10% growth is driven by increasing adoption of cloud-based HR solutions, expansion into new markets, and strategic partnerships. The company's innovative workforce management and payroll processing solutions are in high demand, particularly among mid-sized businesses. Additionally, the growing need for compliance with labor laws and regulations is fueling demand for Dayforce's services.

7. Detailed Products

Human Capital Management (HCM)

A comprehensive HCM solution that provides a single, cloud-based platform for managing the entire employee lifecycle, from recruitment to retirement.

Payroll and Tax Compliance

A robust payroll processing solution that ensures accurate and timely payment of employee salaries, while also ensuring compliance with tax laws and regulations.

Time and Attendance

A time-tracking solution that enables employees to clock in and out, while providing real-time visibility into labor costs, attendance, and productivity.

Benefits Administration

A benefits administration solution that enables employees to enroll in benefits, manage their benefits, and access benefits information.

Performance Management

A performance management solution that enables organizations to set goals, track progress, and provide continuous feedback and coaching.

Recruiting and Onboarding

A recruiting and onboarding solution that enables organizations to attract, select, and onboard top talent, while providing a seamless candidate experience.

8. Dayforce Inc's Porter Forces

Forces Ranking

Threat Of Substitutes

Dayforce Inc. operates in a niche market, providing human capital management software solutions. While there are substitutes available, they are not as comprehensive as Dayforce's offerings, reducing the threat of substitutes.

Bargaining Power Of Customers

Dayforce Inc. has a diverse customer base, and no single customer accounts for a significant portion of its revenue, reducing the bargaining power of customers.

Bargaining Power Of Suppliers

Dayforce Inc. is not heavily dependent on a single supplier, and the market for its inputs is competitive, reducing the bargaining power of suppliers.

Threat Of New Entrants

While there are barriers to entry in the human capital management software market, new entrants can still disrupt the market. However, Dayforce Inc.'s established brand and customer base provide some protection.

Intensity Of Rivalry

The human capital management software market is highly competitive, with several established players competing for market share. Dayforce Inc. must continually innovate and improve its offerings to maintain its market position.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 34.15%
Debt Cost 5.09%
Equity Weight 65.85%
Equity Cost 10.45%
WACC 8.62%
Leverage 51.86%

11. Quality Control: Dayforce Inc passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
CleanSpark

A-Score: 4.5/10

Value: 5.6

Growth: 4.4

Quality: 9.0

Yield: 0.0

Momentum: 7.0

Volatility: 1.0

1-Year Total Return ->

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Stock-Card
Dayforce

A-Score: 4.3/10

Value: 2.8

Growth: 7.3

Quality: 4.7

Yield: 0.0

Momentum: 6.0

Volatility: 4.7

1-Year Total Return ->

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Stock-Card
Bill.com

A-Score: 4.0/10

Value: 2.9

Growth: 9.4

Quality: 4.6

Yield: 0.0

Momentum: 4.0

Volatility: 3.0

1-Year Total Return ->

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Stock-Card
PowerSchool

A-Score: 3.9/10

Value: 4.6

Growth: 7.4

Quality: 3.7

Yield: 0.0

Momentum: 5.0

Volatility: 2.7

1-Year Total Return ->

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Stock-Card
Asana

A-Score: 3.7/10

Value: 4.4

Growth: 6.3

Quality: 3.7

Yield: 0.0

Momentum: 6.0

Volatility: 2.0

1-Year Total Return ->

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Stock-Card
Instructure Holdings

A-Score: 3.7/10

Value: 3.1

Growth: 7.8

Quality: 3.1

Yield: 0.0

Momentum: 5.0

Volatility: 3.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

69.11$

Current Price

69.11$

Potential

-0.00%

Expected Cash-Flows