Zacks Investment Research downgraded shares of Autodesk Inc. (ADSK) from NEUTRAL to UNDERPERFORM on November 20, 2013, with a target price of $38.00.
Autodesk's reported a mixed second-quarter fiscal 2014 results which was negatively impacted by the macroeconomic environment and soft end-market demand. Although revenues and earnings beat the Zacks Consensus Estimate, both declined on a year-over-year basis. However, the company witnessed some demand for design related suites and the AEC business segment. Moreover, its new cloud-based offerings are expected to gain traction going forward. The company's focus on expanding its mobile applications for both iOS and Android platform is expected to drive top-line in the long run. However, less spending by the infrastructure companies on engineering software, sluggish macro-economic environment, weakness in emerging markets, customer concentration and increasing competition are major concerns. Moreover, continued investments in new products are expected to hurt margins in the near term. Thus, we downgrade Autodesk to Underperform and set a target price of $38.00.
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