Stock Markets Analysis & Opinion

Design Software Stocks Q2 Recap: Benchmarking PTC (NASDAQ:PTC)

 

Quarterly earnings results are a good time to check in on a company’s progress, especially compared to other peers in the same sector. Today we are looking at PTC, and the best and worst performers in the design software group.

This article was originally published on Stock Story

The demand for rich, interactive 2D, 3D, VR and AR experiences is growing, and while the ubiquitous metaverse might still be more of a buzzword than a real thing, what is real is the demand for the tools to create these experiences, whether they are games, 3D tours or interactive movies.

The 8 design software stocks we track reported a slower Q2; on average, revenues beat analyst consensus estimates by 1.96%, while on average next quarter revenue guidance was 2.83% under consensus. Technology stocks have been hit hard on fears of higher interest rates as investors search for near-term cash flows and while some of the design software stocks have fared somewhat better than others, they have not been spared, with share prices declining 8.49% since the previous earnings results, on average.

PTC

Used to design the Airbus A380 and Boeing (NYSE:BA) 787 Dreamliner commercial airplanes, PTC’s software-as-service platform helps engineers and designers create and test products before manufacturing.

PTC (NASDAQ:PTC) reported revenues of $542.3 million, up 17.3% year on year, beating analyst expectations by 3.41%. It was a weaker quarter for the company, with underwhelming revenue and non-GAAP EPS guidance guidance for the next quarter. Similarly, its full-year revenue and non-GAAP EPS guidance missed Wall Street’s expectations.

PTC Total Revenue

The stock is down 5.31% since the results and currently trades at $136.51.

Best Q2: Procore Technologies

Used to manage the multi-year expansion of the Panama Canal that began in 2007, Procore Technologies (NYSE:PCOR) offers a software-as-service project, finance and quality management platform for the construction industry.

Procore Technologies reported revenues of $228.5 million, up 32.7% year on year, beating analyst expectations by 4.84%. It was a “beat and raise” quarter for the company. Revenue and EPS exceeded expectations during the quarter. The company lifted full-year revenue guidance, which also exceeded Wall Street’s expectations.

Procore Technologies Total Revenue

Procore Technologies pulled off the strongest analyst estimates beat and highest full year guidance raise among its peers. The company added 615 customers to a total of 15,704. The stock is down 5.21% since the results and currently trades at $68.62.

Weakest Q2: Matterport

Founded in 2011 before any mass market VR headset was released, Matterport (NASDAQ:MTTR) provides the hardware and software necessary to turn real world spaces into 3D visualization.

Matterport reported revenues of $39.6 million, up 38.9% year on year, in line with analyst expectations. It was a weak quarter for the company, with revenue guidance for the next quarter and full-year missing analysts’ expectations.

Matterport had the weakest full year guidance update in the group. The company added 56,000 customers to a total of 827,000. The stock is down 28.3% since the results and currently trades at $2.26.

Cadence

With the name chosen to reflect the idea of a repeating pattern or rhythm in electronic design, Cadence Design Systems (NASDAQ:CDNS) offers a software-as-a-service platform for semiconductor engineering and design.

Cadence reported revenues of $976.6 million, up 13.9% year on year, missing analyst expectations by 0.08%. It was a weaker quarter for the company, with underwhelming revenue guidance for the next quarter.

Cadence had the weakest performance against analyst estimates among the peers. The stock is up 3.12% since the results and currently trades at $248.6.

ANSYS

Used to help design the Mars Rover, Ansys (NASDAQ:ANSS) offers a software-as-a-service platform that enables simulation for engineering and design.

ANSYS reported revenues of $496.6 million, up 4.8% year on year, beating analyst expectations by 1.33%. It was a weak quarter for the company, with underwhelming revenue guidance for the next quarter and a decline in its gross margin.

ANSYS had the slowest revenue growth among the peers. The stock is down 7.48% since the results and currently trades at $300.92.

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