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Autodesk (ADSK) Hits 52-Week High on Solid Growth Drivers

Zacks Equity Research

Share price of Autodesk Inc. (ADSK) rallied to a new 52-week high of $85.46, eventually closing a tad lower at $85.14 on Feb 16. Shares have registered a strong one-year return of 76.80%, better than the Zacks categorised Computer-Software industry’s gain of 25.80% over the same period.


Currently, Autodesk holds a Zacks Rank #3 (Hold). Notably, the stock has a market cap of $18.95 billion and a long-term expected earnings growth rate of 17.36%.

Key Factors

Autodesk’s ongoing business transition (from licenses to cloud-based services) will boost its subscriptions and deferred revenues in the long run. Furthermore, investors’ confidence is boosted by the fact that the company continues to expect subscriptions to grow at a CAGR of 20% that will lead to total annualized recurring revenue (ARR) growth at a CAGR of 24%.

We believe that Autodesk’s aggressive acquisition strategy has played a pivotal part in developing its business over the last couple of years. Plus, Autodesk also expanded its share repurchase program in its efforts to maximize shareholder value.

Autodesk, Inc. Price and Consensus

Autodesk, Inc. Price and Consensus | Autodesk, Inc. Quote


Going ahead, the company’s financials may be affected by increasing investments in cloud-based infrastructure and marketing initiatives. Foreign exchange fluctuations and competition in the cloud-computing domain from the likes of Amazon.com Inc. AMZN and Microsoft Corp. MSFT also remain headwinds.

Estimate Revisions

Over the last 60 days, the Zacks Consensus Estimate for Autodesk has remained stable at a loss of 49 cents for 2017 and at a loss of 29 cents for 2018.

A better-ranked stock in the wider technology space is Oclaro Inc. OCLR, which carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

In the trailing four quarters, Oclaro recorded a positive average earnings surprise of 75.00%.

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