Autodesk Stock (ADSK): Should I Buy It Now?

By Amit Chowdhry ● May 20, 2020
  • Should you buy Autodesk, Inc. (NASDAQ: ADSK) stock now? Here is some information to help you decide.

Autodesk, Inc. (NASDAQ: ADSK) — the company known for making “software for people who make things” — has had a rollercoaster year when it comes to their stock price. On February 19, 2020, the Autodesk stock price was trading at $210.76 and then it dropped down $137.05 on April 2, 2020, only to surge back up to $196-$197 now.

Earnings Announcement Scheduled

Autodesk, Inc. (NASDAQ: ADSK) recently announced that it rescheduled its first-quarter fiscal 2021 financial results conference call to Wednesday, May 27, 2020, at 2:00 p.m. PT via a live webcast call at www.autodesk.com/investors. And Autodesk will also be hosting its Digital Investor Day on Wednesday, June 3, 2020, at 8:30 a.m. PT.

In related news, Autodesk, Inc. (NASDAQ: ADSK) recently announced the early release of the BIM 360 Assets module within Autodesk Construction Cloud:

Autodesk Construction Cloud Adds Assets Module

The BIM 360 Assets module enables construction teams to track and manage project their assets through the entire building lifecycle – from design through handover within one single location. BIM 360 Assets can easily track all construction assets like materials (concrete, wood, drywall, etc.), components, and equipment (air handling units, pumps, chillers, elevators, etc.), moveable equipment (forklift, excavator, concrete buckets, etc.) and rooms or areas.

And the new module also gives construction teams increased access to asset data in the field, allowing them to perform commissioning and resolve defects on-site, decreasing the time to operations and reducing risk. The new BIM 360 Asset module will be included as part of BIM 360 Build subscriptions and generally available starting in mid-June.

“With the BIM 360 Assets module, we’ll be able to deliver a complete and fully linked archive of all construction assets, streamlining the handover process from construction to operations,” said Simon Terroitin, BIM coordinator at EBC, Inc. “BIM 360 Assets will allow us to better collaborate with our clients during site construction and give them exactly what they need right after construction completes. We see this having a significant impact on building client relationships and winning future business.”

The BIM 360 Assets platform connects asset data management for contractors and owners. And traditionally, assets have been tracked using multiple spreadsheets or paper-based tools — which can be a disorganized and time-consuming process particularly when an asset needs to be accounted for throughout the lifecycle of a project.

When asset data is disconnected from the project and in siloes, asset tracking – like determining the installation status of an HVAC unit, pinpointing the location of an excavator or scheduling interior finishes that require a long lead time – can be inefficient. And this lack of connectivity can lead to scheduling delays, cost overruns, and potential liability if assets are installed incorrectly, not to mention poor client satisfaction when the owner is obliged to assume responsibility during facility management set-up.

“The world in which we live today underscores the importance of resiliency, including project and data continuity,” commented Sameer Merchant, head of research and development for Autodesk Construction Solutions and associate vice president at Autodesk. “For project owners and contractors, this means spreadsheet-based asset tracking must evolve into a single source of truth for all assets, accessible by all teams at any time. BIM 360 Assets will improve both day-to-day workflow and handover, and subsequently become a part of any successful company’s future resiliency program. This is yet another way Autodesk Construction Cloud is helping construction teams efficiently manage the entire building lifecycle with data flowing from design through to operations.”

Some of the key features of the BIM 360 Assets include centralized documentation, the ability to connect asset data from quantity take-off, barcode/QR code scanner, integrated field management workflows, and importing/customization.

“At PARIC, we are focused on finding the best enterprise solutions and solving for hundreds of projects rather a single one,” commented Andy Leek, vice president of technology & innovation at PARIC. “The new BIM 360 Assets module provides a cleaner way to manage equipment sets and other facility components across the entire company. We’ll be able to simplify project set-ups and in turn, decrease miscommunication to eliminate rework and reduce risk at handover.”

Should You Buy Autodesk, Inc. (NASDAQ: ADSK) Now?

Based on the reports I have been reading, 63% of analysts are saying buy, 25% of analysts are saying hold, and 13% are saying sell. Personally, I’m bullish on investing in Autodesk for the long-run as I believe their management team has been very strategic to adapt to the changes in demand from potential customers. For example, demand from the construction industry from Autodesk increased so the company acquired PlanGrid and BuildingConnected over the last couple of years.

Case From The Bulls

The bulls say that operating leverage could be better than expected since Autodesk benefits from much lower costs in marketing and advertising due to the eStore growth. And Autodesk should be able to expand on its annual recurring revenue based on the growing average revenue per subscriber. Currently, there are about 12 million people using pirated versions of Autodesk software and the company should be able to capture a major portion of that group.

Case From The Bears

The bears are saying that Autodesk could experience a significant mix shift towards professionals transitioning from paper drafting, which causes Autodesk’s annual revenue per subscriber to decrease. And a downtown in the economy potentially reduces the annual revenue growth for the company as its customers reduce subscription seats.

Disclosure: I own a small number of Autodesk, Inc. (NASDAQ: ADSK) shares. I wrote this article myself and I do not have any business relationship with any company whose stock I write about. I am not a financial advisor and all articles are my opinion. You should do your own due diligence and consider talking to a financial professional before investing.