Bank Of America Maintains PT, Rating On ADSK

Bank of America, citing a strong Q2 and an expected return to form, maintains its Buy rating and its $38 price target on Autodesk ADSK. In the report, Bank of America writes, “We expect ADSK to rebound from weakness heading into print. Despite concerns over the economic slowdown, ADSK printed a strong Q2, as we previewed, driven by acceleration in AEC and Manufacturing verticals (chart 1), and Suites uptake (+40% y/y) accounting for 29% of total rev vs 23% in Q1. The Q was consistent with the outlook at Analyst Day and BofA Tech Conf in June. Total rev grew +16% y/y, the highest since the '08 recession to $546mn vs our est/cons of $541mn. License rev accelerated to +19% y/y to $333mn vs our est of $331mn. Instead of the declining pattern typical seen in Q2, total deferred rev increased thanks to multi-year subscriptions with large accounts, leading to billings growth of +24%, the highest in the last 2 years. “ ADSK closed at $26.51 yesterday.