Breaking News
Get 40% Off 0
🔎 See NVDA's full ProTips for an instant risks or rewards Claim 40% OFF

Why Autodesk (ADSK) Stock Is Nosediving

Published Nov 22, 2023 10:34 Updated Nov 22, 2023 10:47
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
Why Autodesk (ADSK) Stock Is Nosediving
 
ADSK
-1.18%
Add to/Remove from a Portfolio
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

Stock Story -

What Happened: Shares of design software company Autodesk (NASDAQ:ADSK) fell 5.3% in the morning session after the company reported third quarter results and provided revenue guidance for the next quarter that fell short of Wall Street's projections. Additionally, the company expects headwinds to FY'2025 growth due to "macroeconomic drag on new subscriber growth, a smaller EBA (enterprise business agreement) renewal cohort with less upfront revenue mix, and the absence of EBA true-up payments." On the other hand, revenue and EPS topped Wall Street's estimates, driven by better-than-expected billings and outperformance in its Architecture, Engineering, and Construction ("AEC") division.

Zooming out, it was a mixed quarter, with the weak growth outlook likely to raise concerns among investors.

In a separate but related development, Piper Sandler downgraded the stock's rating from Overweight (Buy) to Neutral (Hold) and lowered the price target from $240 to $215. The analyst cited less optimistic FY'25 growth expectations and tempered margin outlook. This is a further drag on the stock as stock prices generally follow the direction of Wall Street's estimates.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Autodesk? Find out by reading the original article on StockStory.

What is the market telling us: Autodesk's shares are very volatile and over the last year have had 3 moves greater than 5%. In context of that, today's move is indicating the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The biggest move we wrote about over the last year was 3 months ago, when the stock gained 8.8% on the news that the company reported an impressive "beat and raise" quarter. Second quarter results surpassed analysts' expectations for key topline metrics, including revenue, billings, and remaining performance obligation ( RPO - a leading indicator of revenue). In addition, earnings per share beat Wall Street's expectations.

Moving ahead, guidance came in strong, with revenue projections for the next quarter and full year exceeding expectations, with management lifting the full year growth outlook. Similarly, the full year EPS guidance was raised and came in above consensus estimates. Overall, we think this was a decent quarter, showing that the company is staying on target.

Autodesk is up 11.9% since the beginning of the year, but at $207.33 per share it is still trading 9.6% below its 52-week high of $229.28 from February 2023. Investors who bought $1,000 worth of Autodesk's shares 5 years ago would now be looking at an investment worth $1,561.

Why Autodesk (ADSK) Stock Is Nosediving
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email