/PTC%20Inc%20logo%20on%20phone-by%20rafapress%20via%20Shutterstock.jpg)
PTC Inc. (PTC) is a software company valued at a market cap of $20.6 billion, that specializes in digital transformation solutions for industrial businesses. The Boston, Massachusetts-based company’s key offerings include Creo for 3D CAD, Windchill for PLM, and ThingWorx for IoT and augmented reality (AR).
The industrial software powerhouse has lagged behind the broader market over the past year, falling 5.3%, compared to the S&P 500 Index’s ($SPX) 22.3% gains. This year, PTC has dropped 7%, while the SPX is up 4% on a YTD basis.
Narrowing the focus, PTC has also underperformed the Technology Select Sector SPDR Fund’s (XLK) gains of 17.1% over the past year and a 3.2% rise in 2025.
On Feb. 5, PTC released its fiscal first-quarter earnings, and its shares dropped more than 9% in the next trading session. While headline figures appeared disappointing, underlying metrics remained solid. Its constant currency ARR grew 11% year-over-year to $2.3 billion, and free cash flow rose 29% to $236 million. Revenue increased 3% to $565 million, while non-GAAP EPS of $1.10 beat expectations.
Despite strong fundamentals, investor concerns emerged over PTC’s cautious full-year outlook and a slightly lower Q2 forecast, which some analysts consider conservative. The company reaffirmed its fiscal 2025 constant currency ARR growth target of 9-10% but tempered near-term expectations. Additionally, its ongoing go-to-market strategy realignment, centered on five key industrial verticals, has introduced uncertainty as investors assess its long-term impact.
For the current fiscal year, ending in September 2025, analysts expect PTC to report a 21.5% year-over-year growth in EPS to $4.46. Moreover, the company has a robust earnings surprise history. It has surpassed analysts’ earnings estimates in the past four quarters.
PTC stock has a consensus “Strong Buy” rating overall. Among the 18 analysts covering the stock, 13 recommend “Strong Buy,” one advises “Moderate Buy,” and four suggest a “Hold” rating.
This configuration has been consistent for the past months.
On Feb. 6, KeyBanc Capital Markets raised its price target for PTC from $205 to $211 while maintaining an “Overweight” rating, citing confidence in the company's financial outlook. The adjustment follows PTC’s Q1 constant currency ARR growth of 10.6%, aligning with estimates. Despite issuing a slightly lower Q2 forecast, PTC reaffirmed its FY 2025 ARR and Free Cash Flow (FCF) guidance. The firm's go-to-market realignments are progressing as expected, and its strong gross profit margins (80.65%) and revenue growth (9.6%) reinforce its financial strength.
PTC’s mean price target of $206 represents a premium of 20.4% to current price levels. Meanwhile, the Street-high price target of $240 suggests a potential upside of 40.3%.
