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Did Park City Group's (NASDAQ:PCYG) Share Price Deserve to Gain 60%?

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On average, over time, stock markets tend to rise higher. This makes investing attractive. But not every stock you buy will perform as well as the overall market. Over the last year the Park City Group, Inc. (NASDAQ:PCYG) share price is up 60%, but that's less than the broader market return. On the other hand, longer term shareholders have had a tougher run, with the stock falling 33% in three years.

See our latest analysis for Park City Group

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.

Park City Group was able to grow EPS by 59% in the last twelve months. This EPS growth is remarkably close to the 60% increase in the share price. So this implies that investor expectations of the company have remained pretty steady. It looks like the share price is responding to the EPS.

You can see below how EPS has changed over time (discover the exact values by clicking on the image).

earnings-per-share-growth
earnings-per-share-growth

We know that Park City Group has improved its bottom line lately, but is it going to grow revenue? Check if analysts think Park City Group will grow revenue in the future.

A Different Perspective

Park City Group provided a TSR of 60% over the year. That's fairly close to the broader market return. To take a positive view, the gain is pleasing, and it sure beats annualized TSR loss of 6%, which was endured over half a decade. While 'turnarounds seldom turn' there are green shoots for Park City Group. It's always interesting to track share price performance over the longer term. But to understand Park City Group better, we need to consider many other factors. To that end, you should be aware of the 2 warning signs we've spotted with Park City Group .

We will like Park City Group better if we see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.

This article by Simply Wall St is general in nature. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.