Autodesk shares soar 15% to a record

Key Points
  • Several analysts raised their price targets on Autodesk stock following the beat.
  • Autodesk's outlook for the third quarter and full fiscal year were in line with expectations.
Autodesk president and CEO Andrew Anagnost in June 2017.

Autodesk shares rose 15 percent on Friday, a day after the design software company blasted past analysts' projections in its earnings report.

The stock hit a 52-week high of $157.78 during Friday's trading hours and closed at $157.20, above the previous all-time high of $141.26 that it reached in June.

Like Adobe, Intuit, Microsoft and other business software companies, Autodesk has sought to shift toward the cloud in recent years, and while doing so, their stocks have generally outperformed the S&P 500.

Autodesk exceeded results for the second quarter of its 2019 fiscal year, reporting 19 cents in earnings per share, excluding certain items, on $611.7 million in revenue, according to a statement. Analysts had been expecting 15 cents per share, excluding certain items, on $600 million in revenue, according to Thomson Reuters. The company's guidance lined up with expectations.

Autodesk reported $1.66 billion in annualized recurring revenue from subscription plans, up 112 percent. The company has around 2 million legacy users with perpetual licenses and no maintenance plans, Chief Financial Officer R. Scott Herren told analysts on Thursday's conference call. The idea is to get these users to move from licenses to subscriptions.

"We're making good strides on that," Herren said.

Analysts at Canaccord Genuity, Credit Suisse, Griffin Securities, J.P. Morgan and KeyBanc Capital Markets raised their 12-month price targets on Autodesk stock following the earnings release.

"Autodesk's move to a subscription model should ultimately provide the company with better visibility, more consistency in its financial results and very compelling cash flows," KeyBanc's Monika Garg and Jason Celino wrote in a Thursday note to clients. The analysts raised their target on the stock to $168 from $150.

Canaccord raised its target on Autodesk from $150 to $165.

"Autodesk reported a great quarter that saw essentially all metrics come in above expectations, although we concede that the mix of subscription and maintenance net adds differed from our estimates as the maintenance bleed off this quarter wasn't quite as high as our estimate," the Canaccord analysts wrote in a Thursday note.

Autodesk stock is up 50 percent this year.

Traders bet on Autodesk ahead of earnings