Rosenblatt updated its valuation view on Autodesk Inc., reducing its price target to $330 from $375 while retaining a Buy recommendation. The firm made the move in response to what it characterized as compression in software comparable multiples, even as it expects near-term operating performance to remain solid.
Autodesk shares are trading near multi-quarter lows, quoted at $218.64 and hovering just above a 52-week low of $216.01. Analysis from InvestingPro included in the coverage suggests the stock is undervalued at current levels.
Earnings outlook
Rosenblatt expects Autodesk to deliver a robust fourth quarter and fiscal 2026 results for the period ending January 31, when the company is scheduled to report after the market close on Thursday, February 26. The brokerage projects revenue will come in above its $1.91 billion estimate, which would represent roughly 17% year-over-year growth.
Within the revenue mix, Rosenblatt anticipates the architecture, engineering and construction - AEC - segment to grow about 20%, with the firm pointing to infrastructure spending as a key driver. The AutoCAD and AutoCAD LT product lines are modeled to increase by approximately 13%, according to Rosenblatt's expectations.
Demand and product dynamics
The analyst team sees steady demand across Autodesk's core AEC and mechanical CAD franchises relative to the third quarter, noting consistent renewal rates and a billing-model tailwind. Rosenblatt also reported little change in the commercial real estate end market during the period it reviewed.
On the technology front, Rosenblatt views artificial intelligence as a net positive for engineering software vendors. The firm expects AI integration to enable Autodesk to roll out more value-added features and potentially new revenue-driving products.
Workforce reduction and restructuring charges
On January 22, Autodesk announced a global reduction in force of roughly 7%, impacting around 1,000 employees as the company completes a go-to-market transition. The reduction is concentrated primarily in customer-facing sales roles. Autodesk said at the time it expected to exceed its fourth-quarter guidance metrics despite the cuts.
The company disclosed anticipated pre-tax restructuring charges in a range between $135 million and $160 million, with major portions of those charges expected to be recorded in fiscal 2026 and fiscal 2027. Rosenblatt and other brokers noted the company intends to reinvest some of the savings into strategic priorities over the remainder of the fiscal plan.
Peer and broker reactions
Rosenblatt's downward revision to its price target follows what it described as compression among software comparable multiples - a valuation headwind shared across the sector. Despite this, Rosenblatt maintained its Buy rating.
Other broker activity has been mixed but generally constructive on demand. Morgan Stanley kept an Overweight rating while cutting its price target to $350. KeyBanc reiterated an Overweight rating with a $365 price target, saying quarter-end checks exceeded expectations despite some disruption from the workforce reduction. JPMorgan upgraded Autodesk from Neutral to Overweight and set a $319 price target, highlighting the company's leadership in design and Building Information Modeling software, its cloud-native platform, and rapid AI integration as operational positives.
Financial profile
Autodesk continues to report strong gross profitability. InvestingPro data cited by analysts shows gross profit margins at 92%, and the service also lists additional investor guidance items for users following the company.
Rosenblatt's price-target reduction, driven by sector multiple compression rather than a change to near-term operational forecasts, leaves the firm bullish on Autodesk's underlying business while reflecting a more cautious valuation stance.
What to watch
Investors will focus on Autodesk's reported revenue versus the $1.91 billion benchmark, segment-level growth in AEC and AutoCAD/AutoCAD LT, renewal trends, any near-term impacts from the workforce reduction, and the timing and magnitude of the announced restructuring charges across fiscal 2026 and 2027.