Paycom Software (NYSE:PAYC) shareholders are no doubt pleased to see that the share price has bounced 46% in the last month alone, although it is still down 28% over the last quarter. The full year gain of 16% is pretty reasonable, too.
Assuming no other changes, a sharply higher share price makes a stock less attractive to potential buyers. In the long term, share prices tend to follow earnings per share, but in the short term prices bounce around in response to short term factors (which are not always obvious). The implication here is that deep value investors might steer clear when expectations of a company are too high. Perhaps the simplest way to get a read on investors’ expectations of a business is to look