Overall ADSK gets a fundamental rating of 7 out of 10. We evaluated ADSK against 277 industry peers in the Software industry. While ADSK belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. ADSK is not priced too expensively while it is growing strongly. Keep and eye on this one! These ratings would make ADSK suitable for growth investing!

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

ADSK had positive earnings in the past year.
ADSK had a positive operating cash flow in the past year.
Each year in the past 5 years ADSK has been profitable.
In the past 5 years ADSK always reported a positive cash flow from operatings.

1.2 Ratios

ADSK has a Return On Assets of 9.92%. This is amongst the best in the industry. ADSK outperforms 82.31% of its industry peers.
With an excellent Return On Equity value of 38.40%, ADSK belongs to the best of the industry, outperforming 94.22% of the companies in the same industry.
ADSK has a Return On Invested Capital of 20.36%. This is amongst the best in the industry. ADSK outperforms 94.58% of its industry peers.
ADSK had an Average Return On Invested Capital over the past 3 years of 16.69%. This is significantly above the industry average of 10.78%.
The 3 year average ROIC (16.69%) for ADSK is below the current ROIC(20.36%), indicating increased profibility in the last year.

		Industry Rank	Sector Rank
ROA	9.92%
ROE	38.4%
ROIC	20.36%

ROA(3y)9.38%

ROA(5y)10.1%

ROE(3y)54.38%

ROE(5y)69.36%

ROIC(3y)16.69%

ROIC(5y)14.67%

1.3 Margins

With a decent Profit Margin value of 16.13%, ADSK is doing good in the industry, outperforming 78.70% of the companies in the same industry.
ADSK's Profit Margin has improved in the last couple of years.
The Operating Margin of ADSK (23.87%) is better than 89.17% of its industry peers.
In the last couple of years the Operating Margin of ADSK has grown nicely.
With an excellent Gross Margin value of 90.74%, ADSK belongs to the best of the industry, outperforming 98.19% of the companies in the same industry.
ADSK's Gross Margin has been stable in the last couple of years.

		Industry Rank	Sector Rank
OM	23.87%
PM (TTM)	16.13%
GM	90.74%

OM growth 3Y16.62%

OM growth 5Y16.31%

PM growth 3Y16.98%

PM growth 5Y22.59%

GM growth 3Y0.04%

GM growth 5Y0.11%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so ADSK is creating value.
ADSK has about the same amout of shares outstanding than it did 1 year ago.
The number of shares outstanding for ADSK has been reduced compared to 5 years ago.
Compared to 1 year ago, ADSK has an improved debt to assets ratio.

2.2 Solvency

An Altman-Z score of 4.96 indicates that ADSK is not in any danger for bankruptcy at the moment.
ADSK has a Altman-Z score of 4.96. This is in the better half of the industry: ADSK outperforms 72.56% of its industry peers.
The Debt to FCF ratio of ADSK is 1.19, which is an excellent value as it means it would take ADSK, only 1.19 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 1.19, ADSK is doing good in the industry, outperforming 73.29% of the companies in the same industry.
ADSK has a Debt/Equity ratio of 0.86. This is a neutral value indicating ADSK is somewhat dependend on debt financing.
ADSK has a Debt to Equity ratio of 0.86. This is in the lower half of the industry: ADSK underperforms 73.65% of its industry peers.
Although ADSK does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.

		Industry Rank	Sector Rank
Debt/Equity	0.86
Debt/FCF	1.19
Altman-Z	4.96

ROIC/WACC1.85

WACC10.98%

2.3 Liquidity

A Current Ratio of 0.82 indicates that ADSK may have some problems paying its short term obligations.
Looking at the Current ratio, with a value of 0.82, ADSK is doing worse than 83.75% of the companies in the same industry.
ADSK has a Quick Ratio of 0.82. This is a bad value and indicates that ADSK is not financially healthy enough and could expect problems in meeting its short term obligations.
ADSK has a Quick ratio of 0.82. This is amonst the worse of the industry: ADSK underperforms 83.03% of its industry peers.
ADSK does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.

		Industry Rank	Sector Rank
Current Ratio	0.82
Quick Ratio	0.82

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

ADSK shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 19.20%, which is quite good.
Measured over the past years, ADSK shows a very strong growth in Earnings Per Share. The EPS has been growing by 24.81% on average per year.
ADSK shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 15.55%.
Measured over the past years, ADSK shows a quite strong growth in Revenue. The Revenue has been growing by 13.37% on average per year.

EPS 1Y (TTM)19.2%

EPS 3Y18.7%

EPS 5Y24.81%

EPS Q2Q%23.04%

Revenue 1Y (TTM)15.55%

Revenue growth 3Y11.81%

Revenue growth 5Y13.37%

Sales Q2Q%18.03%

3.2 Future

The Earnings Per Share is expected to grow by 18.57% on average over the next years. This is quite good.
ADSK is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 13.10% yearly.

EPS Next Y22.92%

EPS Next 2Y18.02%

EPS Next 3Y17.07%

EPS Next 5Y18.57%

Revenue Next Year16.9%

Revenue Next 2Y14.02%

Revenue Next 3Y12.71%

Revenue Next 5Y13.1%

3.3 Evolution

The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.

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4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 27.36 indicates a quite expensive valuation of ADSK.
Based on the Price/Earnings ratio, ADSK is valued a bit cheaper than the industry average as 64.26% of the companies are valued more expensively.
ADSK's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.21.
The Price/Forward Earnings ratio is 22.86, which indicates a rather expensive current valuation of ADSK.
Based on the Price/Forward Earnings ratio, ADSK is valued a bit cheaper than the industry average as 67.15% of the companies are valued more expensively.
When comparing the Price/Forward Earnings ratio of ADSK to the average of the S&P500 Index (24.26), we can say ADSK is valued inline with the index average.

		Industry Rank	Sector Rank
PE	27.36
Fwd PE	22.86

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, ADSK is valued a bit cheaper than the industry average as 67.51% of the companies are valued more expensively.
70.04% of the companies in the same industry are more expensive than ADSK, based on the Price/Free Cash Flow ratio.

		Industry Rank	Sector Rank
P/FCF	27.48
EV/EBITDA	31.11

4.3 Compensation for Growth

The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of ADSK may justify a higher PE ratio.
A more expensive valuation may be justified as ADSK's earnings are expected to grow with 17.07% in the coming years.