Aconex Ltd (ASX: ACX) has been one of the top-performing shares on the ASX so far in 2016.

Although its shares briefly dipped as much as 26.2% in February, the shares have since rebounded strongly and are trading 60% higher since the beginning of the year. At $8.32 as of yesterday’s close, they have also risen almost 117% for those investors lucky enough to have bought the shares at their February low.

Source: ASX

Source: ASX

Despite their meteoric rise, analysts continue to issue bullish forecasts for the group’s shares. RBC Capital Markets raised its price target by 21% to $8.50 earlier in the month, while Morgan Stanley has a price target of $10 a share!

By no means a household name, Aconex is a Software-as-a-Service (SaaS) play. The company provides an online collaboration platform for the construction and engineering industry, removing much complexity from projects such as document clutter. It also helps to improve efficiencies and the communications process throughout the life of the project.

Meanwhile, the company recently signed a new four-year enterprise agreement with ExxonMobil Global Services Company, which is the world’s largest publicly traded international oil and gas company. This agreement speaks volumes for the quality of Aconex’s product and should give investors plenty of confidence in the company’s future.

Despite the fact that Aconex is a great company, and the fact that Morgan Stanley thinks the shares could run another 20% from yesterday’s closing price, the shares are not cheap. That doesn’t mean they can’t or won’t go any higher, but it does mean investors need to be cautious to not overpay.

The company generated just $55.7 million revenue and $5.3 million underlying net profit after tax (NPAT) during the first-half. Given the growth being experienced by the company, I would expect the second-half of the year to be stronger than the first but, nevertheless, those figures do pale against the $1.6 billion market capitalisation currently being commanded by the company.

Long-term investors should certainly consider familiarising themselves with the business in case shares do fall. While some may still choose to take out a small position in the shares today, investors should also take a look at some of the market’s other SaaS businesses which may have more upside potential than Aconex, including cloud accounting software provider XERO FPO NZX (ASX:XRO).

Discover How 1 Man Turned $10K Into Over $8 Million

Discover how one man turned a modest $10,600 investment into an $8,016,867 fortune. Learn more about this man and how you can start down the path toward financial independence. Simply click here to learn more.

HOT OFF THE PRESSES: Motley Fool’s #1 Dividend Pick for 2017!

With its shares up 155% in just the last five years, this ‘under the radar’ consumer favourite is both a hot growth stock AND our expert’s #1 dividend pick for 2017. Now we’re pulling back the curtain for you... And all you have to do to discover the name, code and a full analysis is enter your email below!

Simply enter your email now to receive your copy of our brand-new FREE report, “The Motley Fool’s Top Dividend Stock for 2017.”

By clicking this button, you agree to our Terms of Service and Privacy Policy. We will use your email address only to keep you informed about updates to our website and about other products and services we think might interest you. You can unsubscribe from Take Stock at anytime. Please refer to our https://www.fool.com.au/financial-services-guide">Financial Services Guide (FSG) for more information.

Motley Fool contributor Ryan Newman owns shares of Xero. The Motley Fool Australia owns shares of Xero. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.