These days it's easy to simply buy an index fund, and your returns should (roughly) match the market. But you can significantly boost your returns by picking above-average stocks. For example, the Endava plc (NYSE:DAVA) share price is up 89% in the last year, clearly besting the market return of around 12% (not including dividends). If it can keep that out-performance up over the long term, investors will do very well! Endava hasn't been listed for long, so it's still not clear if it is a long term winner.
To quote Buffett, 'Ships will sail around the world but the Flat Earth Society will flourish. There will continue to be wide discrepancies between price and value in the marketplace...' 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 the last year Endava grew its earnings per share (EPS) by 105%. We note that the earnings per share growth isn't far from the share price growth (of 89%). So this implies that investor expectations of the company have remained pretty steady. We don't think its coincidental that the share price is growing at a similar rate to the earnings per share.
The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).
We know that Endava has improved its bottom line lately, but is it going to grow revenue? Check if analysts think Endava will grow revenue in the future.
A Different Perspective
Endava boasts a total shareholder return of 89% for the last year. And the share price momentum remains respectable, with a gain of 23% in the last three months. This suggests the company is continuing to win over new investors. Is Endava cheap compared to other companies? These 3 valuation measures might help you decide.
We will like Endava 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.
If you spot an error that warrants correction, please contact the editor at email@example.com. 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. Simply Wall St has no position in the stocks mentioned.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.