ADSK Testing Price Floor: Time to Load Up?
Autodesk (ADSK) should be on your watchlist. Here is why – it is currently trading in the support zone ($274.78 – $303.70), levels from which it has bounced meaningfully before. In the last 10 years, the stock received buying interest at this level 7 times and subsequently went on to generate 15.2% in average peak returns.
| Peak Return | Days to Peak Return | |
|---|---|---|
| 11/27/2020 | 17.3% | 46 |
| 3/11/2021 | 9.4% | 36 |
| 5/18/2021 | 9.2% | 42 |
| 7/2/2021 | 15.0% | 54 |
| 10/4/2021 | 22.2% | 43 |
| 9/26/2024 | 17.5% | 57 |
| 4/29/2025 | 15.5% | 69 |
But is the price action enough alone? It certainly helps if the fundamentals check out. For ADSK Read Buy or Sell ADSK Stock to see how convincing this buy opportunity might be.
Here are some quick data points:
- Revenue Growth: 12.4% LTM and 11.6% last 3 year average.
- Cash Generation: Nearly 25.2% free cash flow margin and 22.2% operating margin LTM.
- Recent Revenue Shocks: The minimum annual revenue growth in last 3 years for ADSK was 10.6%.
- Valuation: ADSK trades at a PE multiple of 61.2
- Opportunity vs S&P: Compared to S&P, you get higher valuation, higher revenue growth, and better margins
Autodesk provides 3D design, engineering, and entertainment software, including civil engineering solutions for land development, transportation, and environmental projects, distributed directly and via resellers worldwide.
| ADSK | S&P Median | |
|---|---|---|
| Sector | Information Technology | – |
| Industry | Application Software | – |
| PE Ratio | 61.2 | 23.9 |
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| LTM* Revenue Growth | 12.4% | 5.1% |
| 3Y Average Annual Revenue Growth | 11.6% | 5.2% |
| Min Annual Revenue Growth Last 3Y | 10.6% | -0.3% |
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| LTM* Operating Margin | 22.2% | 18.7% |
| 3Y Average Operating Margin | 21.0% | 17.8% |
| LTM* Free Cash Flow Margin | 25.2% | 13.0% |
*LTM: Last Twelve Months
That is one way to look at stocks. Trefis High Quality Portfolio evaluates much more, and is designed to reduce stock-specific risk while giving upside exposure
What Is Stock-Specific Risk If The Market Crashes?
That said, ADSK isn’t immune to big sell-offs. It fell 64% during the Dot-Com crash and nearly 77% in the Global Financial Crisis. The 2022 inflation shock triggered a 52% drop, while even smaller events like the 2018 correction and Covid pandemic knocked it down 25% and 35%, respectively. Solid fundamentals matter, but when the market turns sour, sharp pullbacks still happen.
But the risk is not limited to major market crashes. Stocks fall even when markets are in good shape – think events like earnings, business updates, outlook changes. Read ADSK Dip Buyer Analyses to see how the stock has recovered from sharp dips in the past.
The Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 – the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.