Autodesk
ADSK
$242.47
+1.02%
Autodesk Inc. is a multinational software corporation that develops computer-aided design (CAD) and building information modeling (BIM) software for the architecture, engineering, construction, manufacturing, and media & entertainment industries. As a pioneer in CAD with its flagship AutoCAD product, Autodesk holds a dominant market position, with its software used in iconic projects like the Burj Khalifa and films like Avatar. The current investor narrative revolves around the company's transition to a subscription-based model, its growth in cloud and AI-driven design tools, and recent concerns about near-term execution and AI strategy, as highlighted by a stock dip despite a Q1 earnings beat. The stock has been volatile, with a significant drawdown from its 52-week high, but recent momentum suggests a potential recovery.…
ADSK
Autodesk
$242.47
Related headlines
Investment Opinion: Should I buy ADSK Today?
Rating: Buy. Autodesk's strong revenue acceleration, expanding margins, and robust free cash flow, combined with a consensus Strong Buy rating and an average target price of $313.89 (34% upside), support a bullish stance. The forward PE of 16.43x is attractive relative to growth, and the company's dominant market position in CAD/BIM software provides a durable competitive advantage.
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ADSK 12-Month Price Forecast
The AI assessment is bullish, driven by Autodesk's strong growth metrics and attractive forward valuation. The market's concerns about AI strategy are reflected in the stock's discount, but if the company executes well, there is significant upside. Key factors to watch include the pace of AI product adoption and margin sustainability. An upgrade to high confidence would occur if Autodesk demonstrates tangible AI revenue contributions, while a downgrade would follow if growth decelerates or margins compress.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Autodesk's 12-month outlook, with a consensus price target around $313.89 and implied upside of +29.5% versus the current price.
Average Target
$313.89
0 analysts
Implied Upside
+29.5%
vs. current price
Analyst Count
—
covering this stock
Price Range
$221 - $456
Analyst target range
Autodesk is covered by 33 analysts, with a consensus recommendation of 'Strong Buy' (mean score of 1.43 on a 1-5 scale). The average target price is $313.89, implying an upside of 34.0% from the current price of $234.20. The distribution shows a strong bullish sentiment, with recent actions from firms like Rosenblatt, DA Davidson, and BTIG reiterating Buy ratings, while Citigroup maintains a Neutral stance. The target price range spans from $220.50 (low) to $456.00 (high), indicating a wide dispersion of expectations. The high target of $456 assumes continued strong growth and successful AI integration, while the low target of $220.50 reflects concerns about execution and competitive pressures. The wide range suggests significant uncertainty, but the overall consensus is optimistic, with the average target well above the current price. Recent news of a Q1 earnings beat and raised guidance, despite a stock dip, may have contributed to the positive outlook, as analysts see the dip as a buying opportunity.
Bulls vs Bears: ADSK Investment Factors
Autodesk presents a mixed picture: robust revenue acceleration, expanding margins, and strong cash flow are countered by a significant drawdown, high trailing valuation, and execution concerns. The bull case is currently stronger, supported by analyst consensus and forward valuation, but the stock's volatility and AI strategy uncertainty introduce meaningful risk. The most important tension is whether Autodesk can sustain its growth acceleration and margin expansion to justify its forward PE, or if execution issues and competitive pressures will lead to a de-rating. The resolution of this tension will determine the stock's trajectory over the next 12 months.
Bullish
- Accelerating Revenue Growth: Q1 FY2027 revenue grew 18.43% YoY to $1.934B, up from 9.31% growth in the year-ago quarter. This acceleration is driven by strong AEC and AutoCAD performance, indicating robust demand for Autodesk's design software.
- Expanding Profitability: Net margin improved to 25.39% in Q1 FY2027 from 9.31% a year ago, while operating margin rose to 27.97% from 20.70%. This demonstrates effective cost management and operating leverage from the subscription model.
- Strong Free Cash Flow Generation: Autodesk generated $876M in free cash flow in Q1 FY2027, contributing to a TTM FCF of $2.729B. This provides ample liquidity for investments and potential shareholder returns, despite a current ratio of 0.85.
- Analyst Consensus Strong Buy: With a mean recommendation of 1.43 (Strong Buy) from 33 analysts and an average target price of $313.89, the stock implies a 34.0% upside from the current price of $234.20. Recent reiterations from Rosenblatt, DA Davidson, and BTIG reinforce bullish sentiment.
Bearish
- Significant Drawdown from Highs: The stock is trading 28.6% below its 52-week high of $329.09, with a 1-year price change of -22.73%. This reflects persistent bearish sentiment and underperformance relative to the S&P 500, which gained 18.19% over the same period.
- High Trailing PE Premium: The trailing PE of 47.89x is 37% above the software industry average of 35x, indicating the stock is not cheap on current earnings. This premium could compress if growth decelerates or margins disappoint.
- Execution and AI Strategy Concerns: Despite a Q1 earnings beat, the stock dropped, highlighting investor worries about near-term execution and the company's AI strategy. The Motley Fool noted a 'sales dip' in Autodesk's revenue trends, suggesting potential volatility.
- High Volatility and Beta: With a beta of 1.318, Autodesk is 31.8% more volatile than the market. This amplifies downside risk in market downturns, as evidenced by a max drawdown of -42.56% over the past year.
ADSK Technical Analysis
Autodesk's stock is currently in a recovery phase after a prolonged downtrend, with the 1-year price change at -22.73% and the current price of $234.20 sitting at 28.6% of the 52-week range (between $185.50 low and $329.09 high). This positioning near the lower end suggests the stock is trading at a significant discount to its highs, potentially offering value, but also reflecting the bearish sentiment that has dominated the past year. The stock's beta of 1.318 indicates it is 31.8% more volatile than the market, amplifying both upside and downside moves.
Beta
1.30
1.30x market volatility
Max Drawdown
-42.6%
Largest decline past year
52-Week Range
$186-$329
Price range past year
Annual Return
-20.5%
Cumulative gain past year
| Period | ADSK Return | S&P 500 |
|---|---|---|
| 1m | +14.2% | +2.8% |
| 3m | -0.8% | +4.2% |
| 6m | +0.9% | +11.3% |
| 1y | -20.5% | +21.5% |
| ytd | -15.4% | +12.7% |
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ADSK Fundamental Analysis
Autodesk's revenue growth has been robust, with the most recent quarter (Q1 FY2027, ending April 30, 2026) showing revenue of $1.934 billion, a YoY growth of 18.43%. This growth is accelerating, as the previous quarters showed sequential increases from $1.633 billion in Q1 FY2026 to $1.957 billion in Q4 FY2026. The growth is driven by strong performance in Architecture, Engineering, and Construction (AEC) segment, which contributed $970 million, and AutoCAD family at $474 million, while Media & Entertainment remains a smaller but growing segment at $86 million. The company's profitability is solid, with a net income of $491 million in the latest quarter, representing a net margin of 25.39%, up from 9.31% in the year-ago quarter. Gross margin remains high at 90.95%, and operating margin improved to 27.97% from 20.70% a year ago, indicating efficient cost management. Autodesk's balance sheet is healthy, with a debt-to-equity ratio of 0.90, and the company generated strong free cash flow of $876 million in the latest quarter, contributing to a TTM FCF of $2.729 billion. The current ratio of 0.85 suggests some liquidity pressure, but the robust cash flow and ROE of 36.91% indicate strong financial health and efficient capital utilization.
Quarterly Revenue
$1.9B
2026-04
Revenue YoY Growth
+18.4%
YoY Comparison
Gross Margin
91.0%
Latest Quarter
Free Cash Flow
$2.7B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is ADSK Overvalued?
Given Autodesk's positive net income, the PE ratio is the primary valuation metric. The trailing PE is 47.89x, while the forward PE is 16.43x, indicating the market expects significant earnings growth in the next year. This gap suggests that the market is pricing in a substantial improvement in profitability, which is supported by the company's recent margin expansion and revenue acceleration. Compared to the software industry average PE of approximately 35x, Autodesk trades at a 37% premium on a trailing basis, but on a forward basis, it is at a discount, reflecting the expected growth. The PS ratio of 7.47x is also above the industry average of 5x, but this premium is justified by Autodesk's superior gross margins (90.95%) and strong market position. Historically, Autodesk's PE has ranged from 25x to 152x over the past five years, with the current trailing PE of 47.89x sitting in the middle of that range, suggesting the stock is not at extreme valuation levels. The forward PE of 16.43x is near the lower end of its historical forward PE range, indicating potential undervaluation if the company meets growth expectations.
PE
47.9x
Latest Quarter
vs. Historical
Low-End
5-Year PE Range 25x~97x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
30.2x
Enterprise Value Multiple
Investment Risk Disclosure
Financial & Operational Risks: Autodesk's debt-to-equity ratio of 0.90 indicates a moderate debt load, but the current ratio of 0.85 suggests potential liquidity pressure. While FCF is robust at $2.729B TTM, the company's reliance on continued growth to justify its forward PE of 16.43x is a risk; if revenue growth decelerates from the current 18.43% YoY, the stock could face multiple compression. Additionally, the high gross margin of 90.95% leaves little room for improvement, and any cost inflation could pressure operating margins, which are already at 27.97%.
FAQ
The key risks include: 1) Execution risk on AI strategy, as highlighted by the stock dip despite an earnings beat; 2) Valuation risk, with a trailing PE of 47.89x that could compress if growth slows; 3) Macro risk, given a beta of 1.318 and sensitivity to economic cycles in construction and manufacturing; 4) Competitive risk from emerging design software and AI tools. The most severe risk is a combination of these factors leading to a decline toward the 52-week low of $185.50, a -20.8% downside from the current price.
The 12-month forecast is bullish, with a base case probability of 50% targeting $280-$330, aligning with the analyst average of $313.89. The bull case (30% probability) targets $350-$456, driven by successful AI integration, while the bear case (20% probability) targets $185-$220, reflecting execution failures or market downturns. The most likely scenario is the base case, assuming Autodesk maintains its growth trajectory and margins. Investors should monitor quarterly earnings and AI product developments to gauge which scenario is unfolding.
ADSK is trading at a trailing PE of 47.89x, which is 37% above the software industry average of 35x, suggesting it is overvalued on current earnings. However, the forward PE of 16.43x is below the industry average, indicating the market expects significant earnings growth. The PS ratio of 7.47x is also above the industry average of 5x, but this premium is justified by Autodesk's superior gross margins of 90.95% and dominant market position. Overall, the stock appears fairly valued relative to its growth prospects, with the forward valuation suggesting potential undervaluation if the company meets expectations.
ADSK is a good buy for investors with a long-term horizon and tolerance for volatility. The stock offers a 34% upside to the analyst average target of $313.89, supported by strong revenue growth of 18.43% YoY and expanding margins. However, the trailing PE of 47.89x is high, and the stock has been volatile, with a beta of 1.318. The biggest downside risk is a failure to execute on AI strategy, which could lead to a decline toward the 52-week low of $185.50. For those who believe in Autodesk's growth story, the current price offers an attractive entry point.
ADSK is better suited for long-term investment, given its growth stage and volatility. The stock has a beta of 1.318, making it more volatile than the market, and its 1-year price change of -22.73% shows significant short-term swings. However, the company's strong fundamentals, including 18.43% revenue growth and high gross margins, support a long-term holding period of at least 3-5 years to realize the benefits of its subscription model and AI investments. Short-term trading is possible but risky due to high volatility and execution uncertainties.