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Tuesday, Autodesk (NASDAQ:ADSK) shares, currently trading at $272.52 with a market capitalization of $58.14 billion, remained under DA Davidson’s scrutiny as the firm maintained a Neutral rating and a $265.00 price target for the software company. According to InvestingPro data, the company maintains impressive gross profit margins of 92%. The research firm’s analyst, while reevaluating the factors influencing Autodesk’s operations and governance, pointed to several positive aspects within its Construction Software (ETR:SOWGn) segment.
Autodesk’s Construction Cloud ( ACC (NSE:ACC)) has continued to deliver over 20% organic growth, which is a key metric for the company’s performance. This growth contributes to the company’s overall revenue growth of 11.53% over the last twelve months. This performance, combined with a heightened focus on operating efficiency and recent progress at the Board level, has led DA Davidson to view Autodesk more favorably in this area.
Despite this positive outlook on certain aspects of Autodesk’s business, DA Davidson remains cautious due to the broader market environment. The firm highlighted that Autodesk has less direct exposure to construction volumes compared to competitors like Procore, which could be a factor in the current cautious stance.
The $265 price target set by DA Davidson suggests that the firm values Autodesk at 22 times its expected EV/EBITDA (Enterprise Value/Earnings Before Interest, Taxes, Depreciation, and Amortization). This valuation metric is commonly used to assess the relative value of companies within the same industry.
Autodesk’s performance in the Construction Software segment is particularly noteworthy as it underscores the company’s potential in a specialized market. The analyst’s comments reflect a careful assessment of Autodesk’s growth prospects, operational efficiencies, and strategic governance improvements.
Investors and market watchers will continue to monitor Autodesk’s progress, especially in the areas highlighted by DA Davidson, as indicators of the company’s ongoing performance and future potential in the construction software market. InvestingPro analysis suggests the stock is slightly undervalued at current levels, with additional insights available in the comprehensive Pro Research Report, which provides deep-dive analysis of this and 1,400+ other US stocks.
In other recent news, Autodesk announced the appointment of Jeff Epstein and Christie Simons to its Board of Directors as part of a cooperation agreement with Starboard Value LP. This move is expected to strengthen Autodesk’s expertise in technology, finance, and audit. Meanwhile, several analyst firms have revised their price targets for Autodesk. KeyBanc Capital Markets adjusted its price target to $323 from $335, maintaining an Overweight rating, while Stifel reduced its target to $310 from $350, keeping a Buy rating. Oppenheimer also lowered its price target to $300 from $350, maintaining an Outperform rating. These adjustments reflect considerations of Autodesk’s performance and the broader macroeconomic environment. Additionally, Autodesk board member Elizabeth "Betsy" Rafael announced she will not seek re-election at the 2025 Annual Meeting, concluding her tenure at the company. Rafael’s departure marks the end of her advisory role, during which she contributed significantly to Autodesk’s growth and strategic direction.
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