Market Overview

PTC Has Upside With The Internet Of Things Says Citi

Share:
PTC Has Upside With The Internet Of Things Says Citi
Related
Earnings Scheduled For January 18, 2017
PTC Sales & Marketing Initiatives Explained Courtesy Of CFO Andy Miller
PTC Inc's (PTC) James Heppelmann on Q1 2017 Results - Earnings Call Transcript (Seeking Alpha)

PTC Inc’s (NASDAQ: PTC) mix of software solutions could boost revenue and profitability while the company undergoes a transition, Citi’s Kenneth Wong said in a report. He initiated coverage of the company with a Buy rating and a price target of $48.

PTC is a leading provider of CAD, lifecycle management and IoT software solutions, has a highly motivated direct salesforce and has increased SKU flexibility, all of which would offer advantages versus peers, analyst Kenneth Wong mentioned.

Margin Expansion To Boost Earnings, Cash Flows

PTC’s financial targets for FY21 call for 10 CAGR and EBIT margins in the low 30s. Wong believes these targets are achievable. He added, “We believe 25-50% ACV uplift and a lower touch sale will deliver on the operating goals. We feel there could be additional margin upside of 1-200bps from organic cost cutting.”

Related Link: Now You Can See How Dominant Apple Is Every Second

Call Option On IoT

Although media and investor attention is currently on the consumer IoT market, the opportunity across industrial applications, or IIoT, could significantly outgrow the consumer market, the analyst commented.

“While the overall revenue contribution remains small (~$70M run rate), we believe PTC’s portfolio of products (CAD, PLM, SLM, IoT) makes it one of the best positioned software companies to capitalize on the $1T opportunity,” the Citi report noted.

Do you have ideas for articles/interviews you'd like to see more of on Benzinga? Please email feedback@benzinga.com with your best article ideas. One person will be randomly selected to win a $20 Amazon gift card!

Latest Ratings for PTC

DateFirmActionFromTo
Nov 2016Goldman SachsInitiates Coverage OnBuy
Oct 2016Brean CapitalInitiates Coverage onBuy
Oct 2016CLSAMaintainsOutperform

View More Analyst Ratings for PTC
View the Latest Analyst Ratings

Posted-In: Citi Kenneth WongAnalyst Color Long Ideas Initiation Analyst Ratings Tech Trading Ideas Best of Benzinga

 

Related Articles (PTC)

View Comments and Join the Discussion!