1/ Thread: $ANSS 4Q'20 Earnings Update
Ansys just had a fantastic Q4, but provided a relatively soft 2021 guidance. Stock's down 9%.
Another reminder that past has little relevance, and it's the future that drives any stock.
Here are my notes.
Ansys just had a fantastic Q4, but provided a relatively soft 2021 guidance. Stock's down 9%.
Another reminder that past has little relevance, and it's the future that drives any stock.
Here are my notes.
2/ Revenue growth in Q4 was +28%. That's very impressive, especially because it was relatively tough comp. 4Q'19 revenue itself was +18% YoY.
Operating margin in Q4 improved by ~350 bps.
Operating margin in Q4 improved by ~350 bps.
3/ Thanks to Q4 momentum, ACV ended up +11% this year. 83% of ACV was recurring vs 78% last year.
"Looking long term, we believe that the pandemic may actually cause our total addressable market to go faster than our pre-pandemic projections"
"Looking long term, we believe that the pandemic may actually cause our total addressable market to go faster than our pre-pandemic projections"
4/ Recent AGI acquisition is likely to increase TAM by $800 mn, but it will have 1% negative impact on operating margin in 2021
Guidance: 2021 non-GAAP revenue growth +3% to +8%
ACV growth +8% to +13%
Maintains $2 Bn ACV target in 2022 which implies ~12% growth vs '21 mid-point
Guidance: 2021 non-GAAP revenue growth +3% to +8%
ACV growth +8% to +13%
Maintains $2 Bn ACV target in 2022 which implies ~12% growth vs '21 mid-point
5/ Why is the guidance relatively soft?
Better than expected # of deals closed in Q4 which will be 2% headwind for '21
Cites Covid as a continued headwind for SMB (~33% of Ansys business)
Recovery related uncertainties
US-China trade restrictions will be $25 mn headwind
Better than expected # of deals closed in Q4 which will be 2% headwind for '21
Cites Covid as a continued headwind for SMB (~33% of Ansys business)
Recovery related uncertainties
US-China trade restrictions will be $25 mn headwind
6/ More explanation of the soft guidance here.
Important to note that $ANSS long-term CFO is transitioning and this was first earnings call of the new CFO who will take over on March.
It's possible the new CFO is sandbagging a bit and doesn't want to start by overpromising.
Important to note that $ANSS long-term CFO is transitioning and this was first earnings call of the new CFO who will take over on March.
It's possible the new CFO is sandbagging a bit and doesn't want to start by overpromising.
End/ Here's my deep dive on $ANSS: mbi-deepdives.com/anss/
I'll cover $ETSY 4Q'20 as well in the evening.
I'll cover $ETSY 4Q'20 as well in the evening.
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