Premium content from Motley Fool Share Advisor UK
Our monthly Fire Best Buys Now are designed to highlight our team’s three favourite, most timely Buys from our growing list of growth-focused Fire recommendations, to help Fools build out their portfolios.
“Best Buys Now” Pick #1:
Autodesk (NASDAQ:ADSK)
- The total addressable market of Autodesk is estimated to be $95 billion. Management remains confident that their strong suite of products can deliver 10% to 15% revenue growth for many years.
- The company has recently delivered product enhancements and believes it will continue to produce a free cash flow margin of around 30%.
- A mature company like Autodesk with 10% to 15% sales growth and 30% free cash flow margin is quite impressive.
- In fact, we believe the market doesn’t appreciate that performance right now, which is why the stock really hasn’t done very much over the past 12 months.
- A recent change to its billing process has caused management to forecast lower-than-normal free cash flow, which has soured investors’ sentiment for the stock. But we believe the accounting change does not impact the fundamentals of the business.
