ADSK Stock Analysis

John’s Stock Analysis- Autodesk Inc (ADSK)

Autodesk Inc (ADSK)

Autodesk, Inc. operates as a design software and service company. The company’s Platform Solutions and Emerging Business and Other segment provides AutoCAD computer-aided design application for professional design, drafting, detailing, and visualization; and AutoCAD LT software for professional drafting and detailing. Its Architecture, Engineering, and Construction segment offers Autodesk Revit products to collect information about building projects and coordinate with other representations of the project; AutoCAD Civil 3D products that provide surveying, design, analysis, and documentation solutions

 

Why is this company worth watching?

ADSK has a very good price to earnings ratio. It is higher than most in its industry, and doubles that of the industry as a whole.  We come in at 128.2 while the industry as a whole is 63.8. Investors should expect higher earnings growth in the future. Another key ratio to consider is its price to sales ratio. In a nutshell, this ratio shows how much Wall Street values every dollar of the company’s sales. The lower the ratio, the better value the company provides. In an industry with a historical high price to sales over all ADSK is almost half the industry. ADSK comes in at 4.24- the industry at 7.34. So we have a lot of value and potential with this company.

 

A developer of architectural and engineering software and other related computer products, as
building projects start up again, demand for management and blueprint software should increase. How high will the stock go? Analysts at brokerage firm Jefferies predict Autodesk shares, at $25.10 on Jan. 22, will hit $30 by the year’s end. We are well past that already!

 

Support- After seven straight days of upward movement, we are possibly looking for a short term resting phase for this stock. Before we had this surge up, we built a well-defined resistance point that has now re-invented itself as support. We can see a two week period where it could just not break through the 30.10 barrier but finally did. Now, this is the first strong level of support we expect it to go back to if it is going to back-track
anywhere.

 

Resistance- As this stock inches its way upward, we really need to go to a weekly chart to discover where the levels of resistance will be. It is not until 2008 that we find a well-defined area. No less that 8 times do we have a touch here on the weekly chart. Our first real challenge will be at 34.5 and this will give the stock a nice 10% window before any real challenge to
its movement takes place. After this, our next level is 36.3.

 

Opportunity- As we have stated earlier, ADSK looks like a good value stock with plenty of room to still move upward. As we look at the RSI with the chart, we do see that it appears to be overbought and this could contribute to a short term rest period. We do not think this stock will turn down anytime soon. We are looking for another 10% growth if not more in the next few months.