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Here's Why You Should Buy Aspen Technologies Stock Right Now
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Aspen Technologies (AZPN - Free Report) has been a favorite with investors, owing to its strong fundamentals, management solutions and positive earnings surprise history. It is also aided by robust adoption backed by high demand for asset optimization.
Let’s delve deeper and analyze the factors aiding the company’s performance.
Key Drivers
Fourth-Quarter Performance
AspenTech delivered fourth-quarter fiscal 2018 non-GAAP earnings of 59 cents per share surpassing the Zacks Consensus Estimate by 3 cents. The figure also exceeded the higher end of management’s guided range of 53-55 cents per share.
Revenues inched up 1.8% from the year-ago quarter to almost $126 million, coming ahead of the higher end of management’s projected range of $123-$125 million.
Increase in subscription and software revenues supported year-over-year revenue growth. Impressive performance of Asset Performance Management (“APM”) suite and SMB business also aided growth. The company also witnessed increased demand for Manufacturing & Supply Chain (“MSC”) and engineering suites.
Price Performance
AspenTech stock has returned 60.3% year to date, substantially outperforming growth of 21.9% of the industry it belongs to.
Strong Pipeline, Particularly for APM Bookings
AspenTech has a strong pipeline for new business bookings, and continues to innovate and improve operations.
Subscription based model comprising long-term contracts averaging five years with high-end customers ensure that the revenues keep growing. Further, AspenTech has streamlined business to strengthen core-operations in the long haul.
The company’s persistent efforts to improve its APM bode well. Notably, APM pipeline has quadrupled from the year-ago quarter. Notably, APM accounted for 38% of total pipeline in the fourth quarter of fiscal 2018, up from 32% in the previous quarter. Robust demand of APM is a tailwind.
Further, solid sales execution across Europe, North America and Asia-Pacific bode well. The Aspen Mtell offering also witnessed a robust quarter.
Positive Earnings Surprise History
AspenTech has an impressive earnings surprise history. The company outpaced the Zacks Consensus Estimate in the trailing four quarters, recording a positive average earnings surprise of 11.33%.
Further, it has a long-term expected EPS growth rate of 10.1%.
Mellanox, Microsoft and Logitech have a long-term earnings growth rate of 15%, 12.3% and 8%, respectively.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
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Here's Why You Should Buy Aspen Technologies Stock Right Now
Aspen Technologies (AZPN - Free Report) has been a favorite with investors, owing to its strong fundamentals, management solutions and positive earnings surprise history. It is also aided by robust adoption backed by high demand for asset optimization.
Let’s delve deeper and analyze the factors aiding the company’s performance.
Key Drivers
Fourth-Quarter Performance
AspenTech delivered fourth-quarter fiscal 2018 non-GAAP earnings of 59 cents per share surpassing the Zacks Consensus Estimate by 3 cents. The figure also exceeded the higher end of management’s guided range of 53-55 cents per share.
Revenues inched up 1.8% from the year-ago quarter to almost $126 million, coming ahead of the higher end of management’s projected range of $123-$125 million.
Aspen Technology, Inc. Revenue (TTM)
Aspen Technology, Inc. Revenue (TTM) | Aspen Technology, Inc. Quote
Increase in subscription and software revenues supported year-over-year revenue growth. Impressive performance of Asset Performance Management (“APM”) suite and SMB business also aided growth. The company also witnessed increased demand for Manufacturing & Supply Chain (“MSC”) and engineering suites.
Price Performance
AspenTech stock has returned 60.3% year to date, substantially outperforming growth of 21.9% of the industry it belongs to.
Strong Pipeline, Particularly for APM Bookings
AspenTech has a strong pipeline for new business bookings, and continues to innovate and improve operations.
Subscription based model comprising long-term contracts averaging five years with high-end customers ensure that the revenues keep growing. Further, AspenTech has streamlined business to strengthen core-operations in the long haul.
The company’s persistent efforts to improve its APM bode well. Notably, APM pipeline has quadrupled from the year-ago quarter. Notably, APM accounted for 38% of total pipeline in the fourth quarter of fiscal 2018, up from 32% in the previous quarter. Robust demand of APM is a tailwind.
Further, solid sales execution across Europe, North America and Asia-Pacific bode well. The Aspen Mtell offering also witnessed a robust quarter.
Positive Earnings Surprise History
AspenTech has an impressive earnings surprise history. The company outpaced the Zacks Consensus Estimate in the trailing four quarters, recording a positive average earnings surprise of 11.33%.
Further, it has a long-term expected EPS growth rate of 10.1%.
Zacks Rank & Other Stocks to Consider
AspenTech carries a Zacks Rank #2 (Buy).
Mellanox , Microsoft (MSFT - Free Report) and Logitech International S.A. (LOGI - Free Report) are some other top-ranked stocks in the broader technology sector. All the three stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Mellanox, Microsoft and Logitech have a long-term earnings growth rate of 15%, 12.3% and 8%, respectively.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
See Them Free>>