Citigroup Downgrades Autodesk To Hold

Citigroup has published a research report on Autodesk, Inc.

and has downgraded the company to Hold. In the report, Citigroup writes "We are downgrading Autodesk from Buy to Hold as we believe the risk / reward profile is fully reflected in current valuation. Shares are up nearly 30% since early October and since the beginning of 2010, the stock is up ~60%. Autodesk has historically peaked at 2x the S&P500 multiple during economic upswings, and at current levels (~$41), ADSK is trading at 25X (~2x S&P) our above consensus ($1.63) FY12 EPS of $1.68. Given our expectations for 28% earnings growth in FY12 and already positive outlook on the economy, we do not see a near term catalyst to justify material multiple expansion. We note shares did trade up to 2.5x the S&P 500 multiple on isolated occasions during 205 and early 2006, however this was during the zenith of the global construction boom. We see this as an extraordinary event and not part of a normal recovery process that is likely to occur in the current up-turn." Citigroup maintains its $42 price target on Autodesk, Inc., which closed yesterday at $40.80.