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Valued at a market cap of $22.1 billion, PTC Inc. (PTC) provides software solutions and services that aid manufacturing companies in designing, operating, and managing products. The Boston, Massachusetts-based company offers a comprehensive portfolio of software solutions, including computer-aided design modeling, product lifecycle management, data orchestration, and experience creation products, and is expected to announce its fiscal Q4 earnings results after the market closes on Wednesday, Nov. 6.
Ahead of this event, analysts expect the computer software company to report a profit of $1.05 per share, up 47.9% from $0.71 per share in the year-ago quarter. The company has surpassed Wall Street's bottom-line estimates in three of the last four quarters while missing on one another occasion. In Q3, the company’s adjusted EPS of $0.98 came in line with the consensus estimates.
For fiscal 2024, analysts expect PTC to report an EPS of $3.51, up 18.2% from $2.97 in fiscal 2023. Moreover, EPS is expected to grow 27.4% year-over-year to $4.47 in fiscal 2025.
Shares of PTC have gained 5.4% on a YTD basis, underperforming both the S&P 500 Index's ($SPX) nearly 23% surge and the Technology Select Sector SPDR Fund’s (XLK) 20% return over the same period.
Despite meeting Wall Street’s earnings estimates, shares of PTC closed down 1.1% after its Q3 earnings release as its revenue of $518.6 million missed the consensus estimates of $533 million and declined 4% from a year ago. The weaker-than-expected performance was primarily driven by a decline in license and professional services revenues, offsetting an 8.2% yearly growth in support and cloud services revenues. The company’s 1% year-over-year decline in adjusted EPS, with a 240-bps decline in non-GAAP operating margin to 31.7%, might have further dampened investor confidence.
Yet, analysts' consensus view on PTC’s stock is optimistic, with a "Strong Buy" rating overall. Among 18 analysts covering the stock, 14 recommend a "Strong Buy," one suggests a "Moderate Buy," and three indicate “Hold.”
The average analyst price target for PTC is $203.61, indicating a 10.4% potential upside from the current levels.
On the date of publication, Neharika Jain did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
