Morgan Stanley Raises Autodesk Price Target to $385, Reiterates Overweight Rating.

Morgan Stanley raised Autodesk's (ADSK) price target to $385 from $370 and maintains an Overweight rating. The Q2 report and outlook exceeded expectations, with the firm expecting margin expansion and continued productivity improvements.

Autodesk, Inc. (ADSK) reported robust second-quarter (Q2) earnings, reflecting a 17% year-over-year (YoY) growth in revenue to $1.76 billion, driven by strategic shifts towards SaaS and cloud-based models. The company's Architecture, Engineering, Construction, and Operations (AECO) segment stood out, contributing $878 million in revenue, a 23% YoY increase [1]. This growth was fueled by sustained global investment in infrastructure and industrial projects, as well as Autodesk's cloud-first collaboration tools [2].

Autodesk's financial resilience was evident in its 39% non-GAAP operating margin and a 122% surge in free cash flow to $451 million, driven by disciplined cost management and scalable SaaS economics [1]. The shift to annual billing and a new transaction model added $105 million to revenue and $129 million to billings, accelerating cash flow and customer retention [3].

The company raised its full-year revenue guidance to $7.025–$7.075 billion, citing favorable foreign exchange conditions and continued momentum in AI adoption [2]. Morgan Stanley, in response to the Q2 report and outlook, raised its price target for Autodesk to $385 from $370, maintaining an Overweight rating. The firm expects margin expansion and continued productivity improvements [4].

Investors will closely monitor Autodesk's third-quarter earnings, with revenue projected between $1.8 billion and $1.81 billion, and full-year revenue expected between $7.025 and $7.075 billion [2]. The company's strong performance underscores the transformative power of SaaS and cloud-based revenue models, positioning Autodesk as a leader in the digital transformation of industries.

References:
[1] https://www.ainvest.com/news/autodesk-q2-earnings-outperformance-saas-adoption-cloud-driven-resilience-drive-growth-2508/
[2] https://investors.autodesk.com/news-releases/news-release-details/autodesk-inc-announces-fiscal-2026-second-quarter-results
[3] https://www.ainvest.com/news/wells-fargo-raises-autodesk-pt-375-maintains-overweight-rating-2508/
[4] https://www.ainvest.com/news/morgan-stanley-raises-autodesk-pt-385-maintains-overweight-rating-2508/