Categories Analysis, Technology, Trending Stocks

Autodesk (ADSK) Stock: Here’s all you need to know before investing

The company is thriving on the steady increase in product subscriptions, supported by fast-paced cloud migration

More than a year after the coronavirus outbreak, the digitization spree is influencing every business in which information technology is involved. For Autodesk, Inc. (NASDAQ: ADSK), a leading provider of construction management software, the convergence of design and manufacturing has set a new paradigm, while offering customers greater sustainability and efficiency.

A COVID Winner?

The Mill Valley, California-based tech firm stayed on the growth path despite the unfavorable operating conditions, and its market value expanded by a fifth in the past twelve months. Experts’ analysis indicates that the stock has the potential to grow at the same pace this year too. The moderation in value since hitting a peak in January offers a unique buying opportunity. Considering the impressive earnings performance, right from achieving profitability a few years ago, the shares look fairly valued.


Read management/analysts’ comments on quarterly reports


The company, which is known for market-leading design software AutoCAD, is thriving on the buoyancy of product subscriptions, supported by the fast-paced cloud migration. Strong adoption and high subscription renewal rates should help Autodesk meet its growth targets for the current fiscal year and beyond. The steady increase in digital sales and strong revenue retention rate complement those tailwinds.

autodesk Q1 2022 earnings

Competition

Meanwhile, new players are entering the construction design space, eying opportunities created by the widespread adoption of digital technology and new trends like combining the design and production processes. Recently, rival CAD firm Procore Technologies went public as part of the efforts to broaden its footprint in the rapidly growing construction industry.

Our unique vision is to connect all the phases of construction with end-to-end cloud-based solutions that combine horizontal data flow with best-in-class functionality to enable seamless collaboration from planning, design, preconstruction, construction, asset operations, and maintenance. The breadth and depth of our solutions distinguish us in the market, and we continue to build on that advantage to industry-leading R&D, which we sustain through the pandemic and acquisitions.

Andrew Anagnost, chief executive officer of Autodesk

The core subscription segment, which accounts for about 95% of total business, rose in double digits in the first quarter of 2022 and pushed up revenues to $989 million. As a result, adjusted earnings moved up 21% to $1.03 per share and came in above the consensus estimates. Encouraged by the solid outcome, Autodesk executives have turned bullish on the company’s future performance and raised their outlook for second-quarter earnings and revenue.

What’s New

Last month, Autodesk acquired Upchain, a cloud-native data management solutions provider, in a deal that is expected to simplify data sharing and help customers bring products to market more effectively. The company’s Leading products like Fusion 360 and Vault are being upgraded by integrating new functionalities and features to ensure hassle-free cloud transition for users.


Adobe Q1 profit, revenue beat estimates


For Autodesk’s stock, it has been a rollercoaster ride so far in 2021, after entering the year on a high note and hitting a record high. But the momentum waned quickly and the stock experienced high volatility since then. It traded lower on Tuesday afternoon, after closing the previous session at $285.86.

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