The Monadelphous Group Limited (ASX: MND) share price has continued its stunning run and reached a new multi-year high of $19.01 during trade on Tuesday.
Although it has given back some of these gains, its shares are higher by almost 6% at $18.84 in late afternoon trade.
This means the mining services company's shares are up approximately 68% since the start of the year.
Why are its shares higher today?
This morning Monadelphous provided the market with a trading update at its annual general meeting.
According to the update, the company has experienced a strong first-half to FY 2018 and expects to report half-year revenue growth in excess of 30% on the prior corresponding period.
This appears to be the result of increasing levels of brownfields and sustaining capital expenditure across the resource sector.
While management does expect things to moderate in the second-half, judging by the share price gain today, investors don't seem concerned by this.
Should you invest?
Both Monadelphous and Worleyparsons Limited (ASX: WOR) have been fantastic investments in 2017. But I'm not so sure that 2018 will be the same, at least for Monadelphous.
The company may be having a stunning start to FY 2018, but its full-year guidance has left me feeling slightly underwhelmed. According to management, despite first-half sales revenue growing 30%, full-year revenue is only "expected to increase from 2017".
So with its shares changing hands at an estimated 30x forward earnings, the level of growth the company ultimately delivers may prove to be insufficient to justify this premium.
In light of this, I would suggest investors look to gain exposure to the resources sector through BHP Billiton Limited (ASX: BHP) or Rio Tinto Limited (ASX: RIO) instead.
