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Investing.com - Piper Sandler has reiterated an Overweight rating and $361.00 price target on Autodesk (NASDAQ:ADSK), a $61.2 billion software giant with impressive gross profit margins of 92%. The firm is highlighting three factors that could drive free cash flow expansion beyond the current $1.6 billion level in fiscal year 2027 and beyond. According to InvestingPro analysis, the stock appears slightly undervalued despite trading at a P/E ratio of 61.
The research firm notes that while calendar year 2025 has not shown strong performance for Autodesk so far, with year-to-date returns down 3.22%, the second half still presents an opportunity for the company’s profitability and efficiency narrative to develop as investor focus extends beyond FY26. InvestingPro subscribers can access 15 additional key insights about Autodesk’s financial health and market position through exclusive ProTips.
Piper Sandler identifies three key factors that could drive margin expansion: tighter spending discipline to eliminate duplicative costs, efficiency gains from the new transaction model, and normalization of billings.
The firm believes Autodesk can achieve margin improvement without requiring a cyclical recovery in the Architecture, Engineering, Construction and Operations (AECO) or Manufacturing sectors, which are expected to face continued headwinds.
An analyst day planned for the second half of the year may provide transparent targets for margin expansion in FY27 and beyond, according to Piper Sandler’s research note.
In other recent news, Autodesk has garnered attention with its upcoming fiscal second-quarter earnings report scheduled for August 26. While Stifel has maintained a Buy rating on Autodesk with a $350 price target, their analysis, based on conversations with Autodesk’s platinum-level channel partners, revealed mixed performance results. Meanwhile, Loop Capital initiated coverage on Autodesk with a Hold rating and a $320 price target, citing the company’s navigation through significant transformation and competing business crosscurrents. Citi also reiterated its Buy rating, maintaining a $376 price target, following Autodesk’s business update that outlined strategic priorities such as driving higher margins and pursuing acquisitions.
Additionally, BofA Securities kept its Neutral rating and $330 price target, emphasizing Autodesk’s focus on organic investment and share repurchase programs. In product development, Autodesk announced a new free tier for its Flow Studio VFX tools, aimed at making professional-grade visual effects more accessible to creators. This move comes a year after Autodesk’s acquisition of Wonder Dynamics, the technology’s original developer. These developments reflect Autodesk’s ongoing strategic adjustments and market positioning efforts.
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