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Aspen Technology Inc AZPN

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Aspen Still Awaiting End-Market Recovery, Now Expected in Back Half of 2022; FVE Up to $151

Dan Romanoff, CPA Equity Analyst

Analyst Note

| Dan Romanoff, CPA |

Wide-moat Aspen reported mixed fourth-quarter results that fell short on revenue but exceeded our model and FactSet consensus on adjusted earnings. Management blamed the revenue miss on unclosed transactions rather than a lack of business prospects. Management’s 2022 outlook was broadly in line with expectations, with a back-end loaded year based on a demand environment that remains subdued. The quarter saw relief in some verticals, such as refining and chemicals, where improvement is seen as spending trends tick up. Outside of the core business areas, Aspen continues to emphasize the development of AspenOne AI capabilities, as evidenced by the quarter’s enhancements to version 12.1. Despite the serious impact current macroeconomic downturns continue to have on Aspen’s business, we remain confident in the underlying value and applicability of Aspen’s solutions, as is reflected in a full pipeline and continuing and increasing customer engagement. Based largely on our annual model roll, we are raising our fair value estimate to $151 from $145, and view shares as modestly 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.

20 Crosby Drive
Bedford, MA, 01730
T +1 781 221-6400
Sector Technology
Industry Software - Application
Most Recent Earnings Jun 30, 2021
Fiscal Year End Jun 30, 2021
Stock Type Aggressive Growth
Employees 1,897

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