Weaker-for-longer, such is Credit Suisse’s conclusion post the release of Altium’s unaudited half-yearly numbers. The analysts do note management declared the pipeline of deals looking to materialise in H2 is “significant”.
Earnings estimates have been reduced and the analysts conclude their initiation of coverage with an Outperform rating and $42 price target has proved to be “a half too early”.
In Credit Suisse’s words: “This business is exposed to high levels of non-recurring sales (e.g. license sales), which increases cyclicality and makes the business susceptible to headwinds such as COVID-19.”
Outperform rating retained, while the price target drops to $35 from $42.
Sector: Software & Services.
Target price is $35.00.Current Price is $30.13. Difference: $4.87 – (brackets indicate current price is over target). If ALU meets the Credit Suisse target it will return approximately 14% (excluding dividends, fees and charges – negative figures indicate an expected loss).