Goldman Sachs Analyst Questions Autodesk's Revenue Growth And Total Addressable Market Targets

Core Viewpoint - Goldman Sachs analyst Kash Rangan maintained a Sell rating on Autodesk Inc (ADSK) and lowered the price target from $230 to $225, indicating concerns about the company's growth prospects and reliance on pricing strategies [1]. Group 1: Company Positioning - Autodesk is recognized as a category leader with a dominant market position in design and engineering software [1]. - The company has strong competitive positioning and relative stickiness, which could allow it to command operating margins exceeding 40% in the long term [1]. Group 2: Financial Performance and Growth Concerns - Rangan acknowledged Autodesk's performance in fiscal Q1 2025 but expressed concerns about the company's increasing reliance on pricing in its core design business, which contributes approximately half of its 10-15% mid-term growth target [1]. - The analyst raised doubts about the achievability of Autodesk's $95 billion Total Addressable Market (TAM) by fiscal 2027 and the potential for revenue growth to align with the midpoint of its 10-15% growth framework [1]. - With an already mature adjusted operating margin profile of over 35%, continued leverage may be limited, raising concerns about the sustainability of Autodesk's mid-term Free Cash Flow (FCF) [2]. Group 3: Market Reaction - Autodesk shares experienced a price increase of 5.32%, trading at $222.76 during the last check on Wednesday [2].