In order to expand its Product Lifecycle Management ("PLM")
Autodesk Inc. (
recently announced the acquisition of certain assets of Inforbix
LLC. Although terms of the transaction were not disclosed, the deal
is expected to have no impact on Autodesk's earnings guidance
issued earlier on August 23, 2012.
Boston-based Inforbix develops software solutions that allow
users to scan and access on-premise product data from multiple
sources without any extraction, import or conversion. The software
also helps in connecting disparate data elements. Since it is
cloud-based, Inforbix software is easy to deploy and much more
cost-effective than traditional applications.
Autodesk plans to integrate Inforbix software into Autodesk PLM
360 (its first cloud-based PLM suite launched early 2012), which
will expand the suite's indexing, searching, personalizing, and
data visualization capabilities.
Autodesk has been expanding its cloud-based product offerings
primarily through the acquisition of small start-ups and
Software-as-a-Service ("SaaS") providers such as Inforbix.
We believe that Autodesk will continue to pursue strategic
acquisitions in order to expand its digital prototyping solutions.
These solutions are expected to cater to manufacturers of all
sizes, enhancing their ability to design, visualize and simulate
their products before they are built.
Moreover, accretive acquisitions will enable Autodesk to take
advantage of the staggering growth potential in cloud computing.
According to Forrester, the global market for cloud computing will
grow from $40.7 billion in 2011 to more than $241.0 billion by
2020. As per data available from Deloitte, cloud-based applications
will replace 2.34% of enterprise IT spending in 2014, finally
rising to 14.49% by 2020.
We believe that the new cloud-based products will boost
Autodesk's subscriber base in the near term. The company is also
increasing its penetration in the mobile market by developing
software for smartphones and
iPad. We believe that these initiatives will boost Autodesk's
top-line growth going forward.
However, foreign exchange fluctuations and sluggish
macroeconomic environment remain the primary headwinds. Autodesk's
high exposure to Europe amidst the lingering financial turmoil in
the region keeps us cautious. Moreover, customer concentration and
increasing competition are the other headwinds.
We have a Neutral recommendation on Autodesk's shares in the
long term. Currently, Autodesk has a Zacks #4 Rank, which
translates into a short-term (1-3 months) Sell rating.
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