Stocks of cloud security and compliance solutions company Qualys (QLYS) fell 5.3% on October 8 to close trading at $77.60. The stock is trading 55% above its 52-week low of $50 and 21% below its 52-week high of $98.30.
Qualys stock has generated absolute returns of 282% since February 2016. However, since the start of October 2018, the stock has declined 13%. In 2018, Qualys stock has outperformed broader markets with a gain of 31%.
Revenue and earnings growth
The extended bull run for Qualys has been supported by robust earnings and revenue growth. The company’s sales have risen from $91 million in 2012 to $231 million in 2017. Analysts expect revenue to rise 20.8% to $279 million in 2018 and 18.6% to $331 million in 2019.
In comparison, its earnings per share are estimated to rise by 37.6% in 2018, 18% in 2019, and at a CAGR of 8% over the next five years. The company has a forward 2018 price-to-earnings ratio of 88.7x and 85.7x for 2019. These figures might seem high given the revenue and earnings growth.
Of the 17 analysts tracking Qualys, six have recommended a “buy” for the stock, and 11 have recommended a “hold.” There aren’t any “sell” recommendations. The average 12-month target price for Qualys is $93.10, indicating that it’s trading at a discount of 20% to its current price.