Canadian supply chain software company Kinaxis (Kinaxis Stock Quote, Charts, News, Analysts, Financials TSX:KXS) has come a long way in the past few weeks \u2014 perhaps long enough, says portfolio manager Ross Healy, who thinks the time to trim might be soon if not now. Supply chain constraints are top of mind these days, with economies trying to reopen amid freight issues, shortages in electronic parts and re-staffing shortfalls. The problem reached the heights of the hallowed McDonalds milkshake which are now a scarce commodity in the UK this week, reportedly due to issues with post-Brexit EU immigration rules and COVID-19 measures. Similar woes aren\u2019t hitting Kinaxis, however, which reported quarterly financials earlier this month, saying demand for the company\u2019s RapidResponse software has been growing. \u201cWith all the well-known disruptions that supply chains have endured over the past year, we are seeing a heightened level of interest in the hyper-agility that only Kinaxis can bring to the planning process," said John Sicard, President and CEO of Kinaxis, in an August 5 press release.\u00a0 "Compared to the first half of last year, we have won over twice the number of new customers, and our annual recurring revenue is 24 per cent higher than a year ago. We believe that these are excellent indicators of the positive trends in our business and give us even greater confidence in our expectation of a return to higher SaaS revenue growth next year,\u201d he said. KXS was one of the first stocks to take off in the early days of COVID, doubling in value between April and July of 2020, and while the share price tailed off considerably over the ensuing months, this past couple of months have seen notable gains. KXS has gone from about C$133 per share in early June to now C$197. All those gains could be a warning sign, though, according to Healy. \u201cThe problem with Kinaxis is that when I look at the earnings and its fair market value, the stock is here and the fair market value is down there. And even if the earnings pulled all the way back to their peak back in February of 2019 the stock would still be quite overvalued,\u201d said Healy, chairman of Strategic Analysis Corp and portfolio manager at MacNicol & Associates Asset Management, who spoke on BNN Bloomberg on Wednesday. \u201cHowever, it's in cloud based computing, and everybody's gotten all excited about that kind of stuff. And so the stock, of course, after having been pasted has now enjoyed a very nice recovery,\u201d he said. Healy thinks while the technicals point to further upside on KXS, there\u2019s definitely a limit. \u201cFrom a technical point of view, it has broken out over one of our technical or resistance\/support lines at C$172 and has a fairly easy count to C$222,\u201d he said. \u201cThat would be the peak of the stock however, back in 2020, so I am not going to be able to give you anything more than that, and I would be taking profits as the stock closed in on that level.\u201d Kinaxis\u2019s second quarter 2021 saw revenues drop by two per cent year-over-year to $60.1 million, which broke down into $42.3 million in SaaS business (up 18 per cent from a year earlier), $620,000 in Subscription term license (down 94 per cent), $14.0 million in Professional services (up 13 per cent) and $3.1 million for Maintenance and support (down three per cent). (All figures in US dollars except where noted otherwise.) Adjusted EBITDA for the quarter was $7.1 million compared to $22.5 million a year earlier, while profit was positive at $3.1 million after a couple of quarters in the red. Kinaxis said the long-term picture sees the company hitting $242-$247 million in revenue for 2021, which would be up ten per cent from 2020, with an adjusted EBITDA margin of between 11 and 14 per cent. \u201cBeyond 2021, and assuming an ongoing return to more typical business and market conditions, the company continues to believe that annual SaaS revenue growth of 23-25% is achievable in the mid-term,\u201d the company said in a press release. Late last month, Laurentian Bank Securities analyst Nick Agostino said Kinaxis looks to be on the rebound. \u201cDespite a strong Q1, KXS\u2019 stock slid by about ten per cent since results were reported on May 5, we believe owing to concerns on growth opportunities as the company doubles down on mid-market clients as opposed to enterprise,\u201d said Agostino in a July 29 report to clients. Agostino maintained his \u201cBuy\u201d rating with his report and target price of $200.00 per share, which at the time of publication represented a projected one-year return of 21.6 per cent.