Paycom Software (PAYC) shares skyrocketed 21% on Thursday, posting the top daily performance in the S&P 500, after the payroll and human resources software firm reported better-than-expected sales and profits for the third quarter.

Strength in the jobs market, with a cooldown in inflation, is underpinning a steady pace of hiring and has helped boost demand for Paycom's employee management solutions.

Paycom reported robust sales growth in the third quarter, with total revenue jumping 11.2% year-over-year. Recurring revenue was up 11.6% for Paycom, accounting for 98.5% of Paycom's total revenue. This is highly desirable for software and service providers like Paycom because it represents a stable stream of expected sales.

Paycom stock struggled for the first half of 2024, reaching summer lows beneath $140 per share. However, the trend has been more positive since mid-July, and with Thursday's surge shares moved back above $200 and into positive territory for the year.