Analyst Note| Julie Bhusal Sharma |
PTC’s second-quarter results were strong, as the software company benefited from customers’ continuation on the digital transformation journey and the company’s deferred annual recurring revenue has reached prepandemic levels. Revenue and profitability came in above our expectations thanks to PTC’s core and growth offerings, which are seeing an ongoing shift to software-as-a-service offerings. PTC raised its forecast for the year ahead, largely due to foreign-exchange expectations. We’re maintaining our $88 fair value estimate for the narrow-moat name and view the shares as overvalued, trading near $148 after hours April 28.