What happened

Shares of supply chain software company Manhattan Associates (MANH -10.54%) surged 9.9% through 11:30 a.m. ET after the company reported a big earnings beat last night.

Heading into earnings, analysts had forecast Manhattan Associates would earn only $0.64 per share (adjusted) on sales of $200.5 million. In fact, the company's adjusted earnings turned out to be $0.80 per share -- up 25%, and 33% better than last year's adjusted profit -- on sales of $221 million.  

So what

Granted, the news wasn't quite as good as those numbers make it sound. When calculated according to generally accepted accounting principles (GAAP), Manhattan's per-share profit was only $0.62 -- not $0.80. But even so, this was a very considerable 29% jump from last year's Q1 GAAP profit of $0.48 per share. Sales growth, too, was quite brisk, up 23.5% year over year.  

Said CEO Eddie Capel, "Demand is strong, customer satisfaction is solid, and ... cloud and services revenue growth exceeded our expectations... Manhattan Associates is off to a great start to 2023." 

Now what

All that being said, Capel mentioned that he is "appropriately cautious" -- despite the strong start to the year -- about the global economy and how Manhattan will be able to sustain this momentum going forward. Guiding through the end of this year, Manhattan sees sales growth slowing down into the 12% to 13% range, ending the year with about $860 million in sales. Earnings growth will slow as well from Q1's torrid pace.

By GAAP accounting, Manhattan sees profits roughly flat against last year -- $2 to $2.06 per share. Adjusted earnings should grow about 4%.

Should this slowdown worry investors? I think it might.

Consider that what Capel is promising now is essentially a slow-to-no-growth year in 2023, for a stock that's valued at more than 81 times current-year earnings. As exciting as today's earnings beat looks, the prospect of growth slowing dramatically later on this year should give investors pause about overpaying for a growth stock that very soon might not be growing very much at all.

Caveat investor.