- Piper Jaffray notes that after two consecutive months of shrinkage in the non-residential
construction pipeline, the ABI (Architectural Billings Index) for the month of July moved back to positive territory, indicating pipeline growth. The ABI has the most direct overlap with customers of Autodesk's (NASDAQ:ADSK) AEC division, which accounts for ~15% of revenue.
CY06 will likely prove to be a tug-of-war between investors concerned about the smaller 2004 product retirement pool and investors confident that new seat growth will offset any upgrade-related slowdown. There are two primary sources of new seat growth: 1) new engineer hiring due to increased project pipelines, and 2) product activation technology. One way to look at the potential for new seat growth is the Architectural Billings Index (ABI), which tracks non-residential project pipelines. In general, the ABI has been strong through the first half of CY06, indicating a growing project pipeline for the remainder of the year. The index was down slightly in May (49.6) and June (49.2), but bounced back into positive territory in the month of July. The July ABI was 51.8 (details on pg 2). Any number greater than 50 indicates an increase in pipeline.
Maintains Outperform and $47 tgt.
Notablecalls: Not actionable but good to know category. This note will have no impact on the share price but since I have been following the story (check the archives), I thought to highlight it.
construction pipeline, the ABI (Architectural Billings Index) for the month of July moved back to positive territory, indicating pipeline growth. The ABI has the most direct overlap with customers of Autodesk's (NASDAQ:ADSK) AEC division, which accounts for ~15% of revenue.
CY06 will likely prove to be a tug-of-war between investors concerned about the smaller 2004 product retirement pool and investors confident that new seat growth will offset any upgrade-related slowdown. There are two primary sources of new seat growth: 1) new engineer hiring due to increased project pipelines, and 2) product activation technology. One way to look at the potential for new seat growth is the Architectural Billings Index (ABI), which tracks non-residential project pipelines. In general, the ABI has been strong through the first half of CY06, indicating a growing project pipeline for the remainder of the year. The index was down slightly in May (49.6) and June (49.2), but bounced back into positive territory in the month of July. The July ABI was 51.8 (details on pg 2). Any number greater than 50 indicates an increase in pipeline.
Maintains Outperform and $47 tgt.
Notablecalls: Not actionable but good to know category. This note will have no impact on the share price but since I have been following the story (check the archives), I thought to highlight it.
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