For many, the main point of investing in the stock market is to achieve spectacular returns. And highest quality companies can see their share prices grow by huge amounts. For example, the Paylocity Holding Corporation (NASDAQ:PCTY) share price is up a whopping 386% in the last half decade, a handsome return for long term holders. If that doesn't get you thinking about long term investing, we don't know what will. It's also good to see the share price up 36% over the last quarter.
While this past week has detracted from the company's five-year return, let's look at the recent trends of the underlying business and see if the gains have been in alignment.
See our latest analysis for Paylocity Holding
There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance. One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.
During five years of share price growth, Paylocity Holding achieved compound earnings per share (EPS) growth of 66% per year. This EPS growth is higher than the 37% average annual increase in the share price. So it seems the market isn't so enthusiastic about the stock these days. Of course, with a P/E ratio of 147.02, the market remains optimistic.
The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).
NasdaqGS:PCTY Earnings Per Share Growth September 28th 2022
We know that Paylocity Holding has improved its bottom line lately, but is it going to grow revenue? This free report showing analyst revenue forecasts should help you figure out if the EPS growth can be sustained.
A Different Perspective
While it's never nice to take a loss, Paylocity Holding shareholders can take comfort that their trailing twelve month loss of 13% wasn't as bad as the market loss of around 21%. Longer term investors wouldn't be so upset, since they would have made 37%, each year, over five years. It could be that the business is just facing some short term problems, but shareholders should keep a close eye on the fundamentals. It's always interesting to track share price performance over the longer term. But to understand Paylocity Holding better, we need to consider many other factors. To that end, you should be aware of the 1 warning sign we've spotted with Paylocity Holding .
Of course Paylocity Holding may not be the best stock to buy. So you may wish to see this free collection of growth stocks.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
對許多人來説,投資股市的主要目的是獲得驚人的回報。而最高質量的公司可以看到它們的股價大幅上漲。例如,PayLocity控股公司納斯達克(Sequoia Capital:PCTY)股價在過去五年裏上漲了386%,對於長期投資者來説,這是一筆可觀的回報。如果這不能讓你考慮長期投資,我們不知道還有什麼會。上個季度股價上漲了36%,這也是件好事。
雖然過去一週該公司的五年回報率有所下降,但讓我們來看看基本業務的近期趨勢,看看收益是否一致。
查看我們對PayLocity Holding的最新分析
不可否認,市場有時是有效的,但價格並不總是反映潛在的商業表現。評估圍繞一家公司的情緒變化的一個有缺陷但合理的方法是將每股收益(EPS)與股價進行比較。
在股價增長的五年中,PayLocity Holding實現了每股收益(EPS)每年66%的複合增長。這一每股收益增幅高於該公司股價年均37%的增幅。因此,這些天市場對該股的熱情似乎不那麼高。當然,在市盈率為147.02的情況下,市場仍然樂觀。
下圖描述了EPS是如何隨着時間的推移而變化的(通過單擊圖像來揭示確切的值)。
納斯達克:PCTY每股收益增長2022年9月28日
我們知道PayLocity Holding最近提高了利潤,但它會增加收入嗎?這免費顯示分析師收入預測的報告應該會幫助你弄清楚每股收益的增長是否可以持續。
不同的視角
雖然虧損從來都不是好事,但PayLocity Holding的股東們可以感到欣慰的是,他們過去12個月的13%的虧損並沒有市場上21%左右的虧損那麼糟糕。較長期的投資者不會如此沮喪,因為他們在五年內每年會獲得37%的收益。可能該業務只是面臨一些短期問題,但股東應密切關注基本面。跟蹤股價的長期表現總是很有趣的。但為了更好地理解PayLocity Holding,我們需要考慮許多其他因素。為此,您應該意識到1個警告標誌我們發現了PayLocity Holding。
當然了PayLocity Holding可能不是最值得購買的股票。所以你可能想看看這個免費成長型股票的集合。
請注意,本文引用的市場回報反映了目前在美國交易所交易的股票的市場加權平均回報。
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本文由Simply Wall St.撰寫,具有概括性。我們僅使用不偏不倚的方法提供基於歷史數據和分析師預測的評論,我們的文章並不打算作為財務建議。它不構成買賣任何股票的建議,也沒有考慮你的目標或你的財務狀況。我們的目標是為您帶來由基本面數據驅動的長期重點分析。請注意,我們的分析可能不會將最新的對價格敏感的公司公告或定性材料考慮在內。Simply Wall St.對上述任何一隻股票都沒有持倉。