Stock of the Day

October 15, 2020

ANSYS (ANSS)

$334.21
-$6.25 (-1.8%)
Market Cap: $29.84B

About ANSYS

ANSYS, Inc. develops and markets engineering simulation software and services for engineers, designers, researchers, and students in the United States, Japan, Germany, China, Hong Kong, South Korea, rest of Europe, the Middle East, Africa, and internationally. It offers structural analysis product suite that provides simulation tools for product design and optimization; the Ansys Mechanical product, an element analysis software; LS-DYNA solver for multiphysics simulation; and power analysis and optimization software suite. The company also offers electronics product suite that provides electromagnetic field simulation software for designing electronic and electromechanical products; Ansys High Frequency Structure Simulator product for radio frequency and microwave design; SCADE product suite, a solution for embedded software simulation, code production, and automated certification; fluids product suite that enables modeling of fluid flow and other related physical phenomena; Ansys Fluent computational fluid dynamics software package; Ansys RedHawk-SC for electronic design automation; Ansys Optics software; and mission-simulation, modeling, testing, and analysis software. In addition, it offers Ansys Granta MI system for materials information management; Ansys Granta Selector technology for materials selection and graphical analysis; CES EduPack product, a set of teaching resources; Granta Materials Data for Simulation; Ansys Lumerical product, a photonics simulation software solution; safety-certified embedded software solutions; Discovery product family for use in the simulation of product design; academic product suite for research and teaching settings. ANSYS, Inc. was founded in 1970 and is headquartered in Canonsburg, Pennsylvania.

ANSYS Bull Case

Here are some ways that investors could benefit from investing in ANSYS, Inc.:

  • Strong Market Position: ANSYS, Inc. is a leader in engineering simulation software, which is increasingly essential for companies looking to innovate and reduce costs in product development.
  • Robust Financial Health: The company has a low debt-to-equity ratio of 0.13, indicating a strong balance sheet and less financial risk, which is attractive to investors.
  • Current Stock Price: As of the latest trading session, ANSYS, Inc. shares are priced at $338.93, reflecting a stable valuation within its 52-week range of $289.82 to $363.03.
  • High Demand for Simulation Software: The growing need for advanced simulation tools in various industries, including automotive and aerospace, supports future revenue growth for ANSYS, Inc.
  • Consistent Trading Volume: The stock has maintained a trading volume close to its average, indicating steady investor interest and liquidity, which is beneficial for potential investors looking to enter or exit positions.

ANSYS Bear Case

Investors should be bearish about investing in ANSYS, Inc. for these reasons:

  • High Price-to-Earnings Ratio: With a P/E ratio of 52.30, the stock may be considered overvalued compared to its earnings, which could deter value-focused investors.
  • Recent Insider Selling: A director recently sold shares, reducing their ownership by 5.51%. This could signal a lack of confidence in the company's short-term performance.
  • Market Volatility: The stock has a beta of 1.12, indicating it is more volatile than the market. This could lead to larger price swings, which may not be suitable for all investors.
  • Potential Economic Downturn: As a company reliant on engineering services, ANSYS, Inc. could be adversely affected by economic slowdowns, impacting its revenue and stock performance.
  • Limited Insider Ownership: With only 0.46% of the stock owned by corporate insiders, there may be less alignment between management and shareholder interests, which could be a concern for investors.

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