For most investors, how much a stock's price changes over time is important. Not only can it impact your investment portfolio, but it can also help you compare investment results across sectors and industries.
The fear of missing out, or FOMO, also plays a factor in investing, especially with particular tech giants, as well as popular consumer-facing stocks.
What if you'd invested in PTC Inc. (NASDAQ:PTC) ten years ago? It may not have been easy to hold on to PTC for all that time, but if you did, how much would your investment be worth today?
PTC Inc.'s Business In-Depth
With that in mind, let's take a look at PTC Inc.'s main business drivers.
Boston, MA-based PTC Inc. provides software solutions and services globally, that aid manufacturing companies to design, operate, and manage products. Founded in 1985, the company was formerly known as Parametric Technology Corporation and changed its name to PTC Inc. in January 2013.
The company offers comprehensive portfolio of software solutions comprising computer-aided design (CAD) modeling, product lifecycle management (PLM), data orchestration (IIoT), and experience creation (AR) products.
Creo is the company’s flagship 3D CAD product. Creo offers design engineers with design flexibility, assembly design, surfacing, and virtual prototyping design capabilities.
PTC’s primary PLM product, Windchill software offers a unified repository for comprehensive product information. Windchill also includes AR capabilities, to aid customers develop a digital product definition and publish the illustration of the product in AR.
Meanwhile, ThingWorx product helps customers to develop and deploy IoT applications; manage connected devices; and analyze complex industrial IoT data, in a cost- and time-efficient manner.
Vuforia Studio product aids industrial enterprises to publish AR experiences superimpose vital digital information from CAD, IoT, and other related sources onto the view of the material things on which users work.
Under ASC 606, the company reported revenues of $1.458 billion for fiscal 2020.
PTC has two operating and reportable segments: Software Products (90.1% of fiscal 2020 revenues), which includes subscription, license and associated support revenues; and Professional Services (9.9%), which includes implementation, consulting and training services.
Bottom Line
Anyone can invest, but building a successful investment portfolio takes a combination of a few things: research, patience, and a little bit of risk. So, if you had invested in PTC Inc. a decade ago, you're probably feeling pretty good about your investment today.
A $1000 investment made in April 2011 would be worth $6,409.53, or a 540.95% gain, as of April 13, 2021, according to our calculations. Investors should note that this return excludes dividends but includes price increases.
Compare this to the S&P 500's rally of 214.12% and gold's return of 14.60% over the same time frame.
Going forward, analysts are expecting more upside for PTC.
PTC is benefitting from continued momentum in average recurring revenue (ARR) growth amid acceleration in digital transformation by enterprises. The company is witnessing robust adoption of Vuforia-Chalk, Vuforia Expert Capture solution along with ThingWorx and Windchill platforms as well as the Onshape suite. Acquisition of Arena Solutions also bodes well. Increasing spending by enterprises on emerging categories like Internet of Things (IoT) and augmented & virtual reality (AR/VR) presents significant prospects for PTC in the longer haul. Shares have outperformed the industry in the past year. Nonetheless, PTC faces stiff competition in the computer-aided design (CAD) market, which might dent the top line. Further, ARR growth is likely to be impacted in fiscal 2021 on reduced bookings’ backlog at the end of fiscal 2020 due to the pandemic.
The stock has jumped 10.48% over the past four weeks. Additionally, no earnings estimate has gone lower in the past two months, compared to 1 higher, for fiscal 2021; the consensus estimate has moved up as well.
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