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Aspen Technology Inc AZPN

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Morningstar’s Analysis

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1-Star Price

PREMIUM

5-Star Price

PREMIUM

Economic Moat

PREMIUM

Capital Allocation

PREMIUM

Aspen Posts Modest Miss, Lowers Guidance As Refineries Struggle; FVE Down to $145

Dan Romanoff, CPA Equity Analyst

Analyst Note

| Dan Romanoff, CPA |

Wide-moat Aspen reported third-quarter earnings that missed on the top- and bottom lines both in relation to consensus expectations as well as company guidance. Aspen did not close deals quite at the pace it expected. Management has lowered 2021 guidance across the board to reflect the change in tone around transaction completions. A large portion of the miss can be attributed to the refining vertical, which Aspen discussed as being affected by the polar vortex that spread through refinery-heavy U.S. regions earlier in the quarter, the extension of global lockdowns, particularly in Europe and India, and the conservative 2021 budgets that were created during volatile macroeconomic environments and low oil prices earlier in the year. Despite the serious impact current macroeconomic downturns are having on Aspen’s business, we remain confident in the underlying value and applicability of Aspen’s solutions, as reflected in a full pipeline and continuing significant customer engagement activity. Considering these factors, we are lowering our fair value estimate to $145, from $148, and now view shares, which have dropped in the aftermarket to around $130, as undervalued.

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Company Profile

Business Description

Aspen Technology is a leading global supplier of software solutions that optimize asset design, operations, and maintenance in complex industrial environments. The company’s AspenOne software platform helps improve process-oriented plant efficiency, and thereby lower capital intensity, increase working capital efficiency, and improve margins. Aspen was founded in 1981 and serves more than 2,300 customers in 32 countries.

Contact
20 Crosby Drive
Bedford, MA, 01730
T +1 781 221-6400
Sector Technology
Industry Software - Application
Most Recent Earnings Mar 31, 2021
Fiscal Year End Jun 30, 2021
Stock Type Classic Growth
Employees 1,710

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