Analyst Note| Julie Bhusal Sharma |
Dassault Systemes reported nice second-quarter results, beating our top-line and adjusted earnings per share expectations as momentum continues in its subscription and cloud business. While Dassault did not overlook macroeconomic uncertainty for the remainder of the year, foreign-exchange effects look to be in its favor, inching its absolute outlook upward, while constant-currency growth is expected to remain stable. We view the shares as fairly valued and confirm our EUR 37 fair value estimate for the wide-moat company, as absolute improvements related to foreign exchange are more short-term in nature. We are impressed by Dassault's expansion into cutting-edge territories like human body drug testing simulation or robust sustainability modeling.