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Time To Start Subscribing To The Autodesk Growth Story

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Time To Start Subscribing To The Autodesk Growth Story

Autodesk, Inc. (NASDAQ: ADSK) reported a second-quarter non-GAAP loss of 11 cents per share on revenues of $502 million, down 9 percent. The results were ahead of the consensus estimates, which called for a loss of 23 cents per share on revenues of $470 million.

Subscription plan subscriptions, total subscriptions as well as deferred revenues increased.

Additionally, the company raised its 2018 guidance.

At the time of writing, shares of Autodesk were rallying 4.29 percent to $115.36.

Long-Term Share Appreciation Likely

Cowen said it continues to see more longer-term share appreciation, as the company executes its business model transition. Accordingly, the firm raised its price target for the shares from $115 to $128, while maintaining its rating on the shares at Outperform.

Cowen highlighted on several metrics from the earnings report:

  • Net subscription adds: 153,000 versus consensus estimate of 132,000 & the firm's estimate of 140,000.
  • Subscription plan net adds: Increased by 270,000, above the firm's 210,000 target.
  • Mntce subscribers: Fell by 117,000 versus 70,000-drop estimated by the firm.
  • ARR: $1.86 billion, up 21 percent, versus estimate of 23 percent.
  • ARPS: Flat sequentially and 2 percent higher year over year versus the firm's estimate of flat performance.
  • Total product subscription: Rose in triple digits.
  • Cloud net adds: Increased 200 percent year over year.

Analysts Gregg Moskowitz, Matthew Broome and Michael Romanelli expect an upward inflection in ARPS by the year-end.

See also: Autodesk: Now The Conversation Gets Interesting

Improved Confidence Leads To Estimate Revision

Meanwhile, KeyBanc Capital Markets analysts Monika Garg and Jason Celino said they are raising their calendar year 2020 estimates on their improved confidence following the release of the quarterly results. The analysts said they are buyers of Autodesk.

KeyBanc Capital Markets believes higher net subscription guidance showed continued execution and increases long-term confidence. The firm also said Maintenance to subscription, or M2S, program WAS on track, with the business continues to go direct.

The firm reiterated its Outperform rating on the shares of the company, while it raised its price target from $128 to $115.

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Image Credit: By Coolcaesar at en.wikipedia, CC BY-SA 3.0, via Wikimedia Commons

Latest Ratings for ADSK

DateFirmActionFromTo
Feb 2021Canaccord GenuityMaintainsBuy
Feb 2021BairdMaintainsOutperform
Feb 2021StifelMaintainsBuy

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