Autodesk Inc (NASDAQ:ADSK) shares climbed almost 4% to around $237 on Wednesday after analysts at Jefferies initiated coverage of the software company with a ‘Buy’ rating and a price target of $300.
In its initiation note, Jefferies described Autodesk as a “durable double-digit grower” supported by strong fundamentals, including high operating margins of around the high-30% range and a capital-light subscription-based model.
The firm highlighted what it sees as structural strength in Autodesk’s position within architecture, engineering, and construction (AEC) software, arguing that its platform is anchored in proprietary 3D design and real-world asset data that is difficult to replicate.
Jefferies also addressed concerns around artificial intelligence disruption, stating that large language models and AI-native coding tools are more likely to enhance productivity within Autodesk’s ecosystem than replace it. The analysts framed AI as a net tailwind, potentially expanding monetization opportunities through subscription tiers and usage-based pricing models, which currently account for a minority of revenue.
They highlighted the company’s recurring revenue profile, high customer retention, and steady margin expansion, while suggesting that recent valuation levels reflect elevated investor concerns about AI-driven disruption and broader software sector sentiment.
From a valuation perspective, Jefferies noted that Autodesk trades near what it considers historically low multiples relative to its long-term earnings and free cash flow profile. The firm pointed to what it views as a “Rule of 50” style profile, combining double-digit growth with strong margins, as supportive of a re-rating if sentiment improves.
Near-term catalysts cited by the analysts include continued product development in AI-assisted design tools, potential progress on proprietary foundational model initiatives in CAD workflows, and improving visibility in end markets tied to construction and infrastructure spending.
Jefferies concluded that it expects continued execution to support earnings and free cash flow growth into the late 2020s, with its $300 price target based on a multiple of projected future free cash flow discounted back to present value.
“The noise from the various business transitions is largely behind the company now, and we see consistent execution to help investor sentiment on the name,” the analysts wrote.