Wedbush Remains Sidelined on Autodesk (ADSK) Following 1Q - PT to $57

Wedbush reiterated a Neutral rating on Autodesk (NASDAQ: ADSK), and raised the price target to $57.00 (from $55.00), following the company's 1Q earnings release and conference call. The company reported net subscription additions of 132K, driven by strong new model additions (140K) due to demand for AutoCAD and LT seats (and no license alternative), enterprise licensing activity, and a 1Q promotion targeted at legacy non-subscribers. However, management cited uncertainty about the boost from last-minute buying of suite licenses as a reason for a cautious 2Q guide.

Analyst Steve Koenig commented, "ADSK shares are likely to be more sensitive to model transition developments than to macro factors. The market has re-rated ADSK shares higher on the heels of activist involvement, restructuring, long-term FCF guidance of $6/ share in FY20, and growing subscription numbers. If ADSK can execute to this plan, the current share price looks attractive. Although we are encouraged by the subscription trends (and we look forward to the bottoming of revenue and EPS optics later this year), we think the many moving parts of ADSK’s transition create some degree of execution risk, particularly over the next several quarters. Accordingly, risk / reward looks balanced to us at current levels."

For an analyst ratings summary and ratings history on Autodesk click here. For more ratings news on Autodesk click here.

Shares of Autodesk closed at $57.52 yesterday.

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