The article was written by Motek Moyen Research Seeking Alpha’s #1 Writer on Long Ideas and #2 in Technology – Senior Analyst at I Know First.

Summary:

Autodesk’s stock already has a year-to-date return of +24.04%. I still reiterate a buy rating for this 3D/CAD/CAM software leader.

I argued six months ago that ADSK can shoot up to $200. This price target could turn out to be true within the next six months.

My fearless forecast is that Autodesk will soon return to consistent profitability after most of its customers switch to the subscription-only model.

More than 95% of ADSK shares are owned by institutional investors. Small retail investors can profit from imitating the stock picking bets of institutional investors.

The 30-day technical indicators and moving averages points to ADSK as a buy. I Know First’s AI stock picking algorithm also has a very bullish one-year forecast for ADSK.

My last buy recommendation for Autodesk (ADSK) was in August 2018. If you heeded my buy rating last August (when ADSK was priced below $130), you could have made a lot of money because this stock now trades at $159-$160 range. Autodesk remains the runaway leader in the growing CAD/CAM software industry. Autodesk’s AutoCAD remains the de facto choice in the growing CAD (Computer Aided Design).

Being the leader in a growing software segment makes ADSK ideal for long-term growth investors. The CAD software market alone is expected to be worth $11.22 billion/year by 2023.

(Source: Statista)

Autodesk’s stock touts a year-to-date return of +24%. I still insist it is a good buy.

(Source: www.ytdreturn.com)

My fearless forecast is that ADSK can hit $200 price barrier within the next six months. This prediction is reasonable. Autodesk only needs to deliver four straight quarters with growing revenue and net income. Doing so will make ADSK even more attractive to institutional investors. Autodesk’s float is more than 95% owned by institutional investors.

It is also worth noting that more institutional investors are taking new positions (100) on Autodesk versus who sold (63) during the most recent quarter. This is an easy buy signal for any stock. When more large investors starts accumulating ADSK, small retail investors should also do so.

Why ADSK Is Becoming More Attractive

The outstanding return performance of ADSK is due to the company’s predicted return to consistent profitability. Based on the chart below, analysts expect Autodesk’s next five quarters to be all profitable. The beauty of software-as-a-service is that it will help Autodesk reduce the headwind of software piracy. It will compel more freelancers and small companies to just use month-to-month subscription. This is better than using pirated copies of AutoCAD, 3DS Max, Maya, and other Autodesk software products.

(Source: MarketBeat)

Why Autodesk’s Bottomline Will Bounce Back

It is my fearless forecast that Autodesk’s will outgrow the difficulties from shifting to pure-play subscription software sales/marketing. By late 2019, I expect holdouts (who still use perpetual licenses and maintenance subscribers) to eventually shift to the pure software-as-a-service platform of Autodesk. Yes, it is true that thousands of AutoCAD, Revit, and other Autodesk products customers got mad over the shift to pure subscription business model. Because Autodesk no longer sells perpetual licenses and annual maintenance subscription (to get updates), many customers shifted to buying competing products.

My view is that infuriated former customers of Autodesk will eventually realize that using AutoCAD or Revit is still necessary if they want to retain their customers. Sad but true, there are dozens of competent CAD/CAM software products but AutoCAD and Revit remain the industry standards. Majority of Engineering and Architectural CAD/CAM customers still demand native AutoCAD and Revit files.

Like it was with Adobe (ADBE), people’s resentment over Autodesk’s abandonment of perpetual licensing will quickly fade away. Adobe’s massive success from Creative Cloud business forced Autodesk to also switch to the SaaS-only model. By becoming a full-pledged SaaS company, Autodesk is now even more formidable software leader. Its rivals in the CAD/CAM software industry will find it hard to grow their business when Autodesk is offering affordable month-to-month subscription plans.

Conclusion

Lack of serious competition in the CAD/CAM software industry makes Autodesk a buy-and-hold-forever investment. Not even SaaS leaders Microsoft (MSFT) and Adobe dared to challenge Autodesk on CAD and CAM (Computer Aided Manufacturing) software products. This enviable status of Autodesk makes it a safe long-term bet for careful investors.

My bullish endorsement for ADSK is also thanks to its bullish one-year algorithmic forecast from I Know First. Note that I Know First’s 12-month forecast score for ADSK is over 100 (bullish signal). The 0.78 predictability score means I Know First has a strong history of accurately predicting the 12-month trend patterns of ADSK.

Further, monthly technical indicators and moving averages (momentum trend) are signaling that ADSK is a buy right now.

Past I Know First Success with Autodesk Stock Forecast

I Know First has had bullish ADSK Stock Forecast September 15, 2017. The AI algorithm issued a bullish 1 year stock forecast with a signal of 91.15 and a predictability of 0.78, the algorithm successfully forecasted the movement of the ADSK stock. See chart below:

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Please note-for trading decisions use the most recent forecast.