10Y annualized return is
very good
at 14.1% per year
ANSS has met or exceeded earnings expectations in
most
recent quarters (9/10)
Strong Gross Profit Margin
Robust Operating Profit Margin
Strong Net Profit Margin
Low Debt-to-Equity Ratio
Strong Liquidity Ratios
Strong Recurring Revenue Model
Diverse Customer Base
High Gross and Operating Margins
Continued Innovation in Key Technologies
Strong Pipeline and Market Demand
High Price-to-Earnings Ratio
Elevated Price-to-Sales Ratio
Impact of Export Restrictions
China's Growth Mute in 2024
Overall, ANSYS demonstrates strong business quality with a solid recurring revenue model and high profitability, despite challenges from export restrictions in China. Looking forward, the company has promising growth prospects driven by innovation in key technology areas and a robust pipeline, although growth may be constrained in the short term due to geopolitical factors.
Analysis Date: November 2, 2023
Last Updated: March 11, 2025
Past performance does not guarantee future results. The data presented is indicative and may not be updated in real-time.
ANSYS, Inc. creates software that helps engineers design and test products before they are built. Their tools allow users to simulate how things like cars, airplanes, and electronics will work in real life, including how they respond to heat, fluids, and forces. This means companies can save time and money by finding problems early in the design process. ANSYS serves a wide range of industries, including automotive, healthcare, and energy, making it easier for professionals to innovate and improve their products.
Streams of revenue
Estimations for reference only
Geographic Distribution
Estimations for reference only
Core Products
Business Type
Business to Business
Competitive Advantages
Key Business Risks
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Benjamin Graham's value investing approach focuses on finding stocks with a significant margin of safety between their intrinsic value and market price.
Intrinsic Value
Estimated fair value based on Graham's formula
$150.69
Current Market Price: $287.50
IV/P Ratio: 0.52x (>1.0 indicates undervalued)
Margin of Safety
Gap between intrinsic value and market price
-91.0%
Graham recommended a minimum of 20-30% margin of safety
Higher values indicate a greater potential discount to fair value
Graham Criteria Checklist
Benjamin Graham's value investing checklist for ANSS
Positive earnings (5+ years)
Dividend history (5+ years)
P/E ratio ≤ 20 (43.58)
P/B ratio ≤ 1.5 (4.12)
Current ratio ≥ 2.0 (3.01x)
Long-term debt < Net current assets (0.44x)
Margin of safety (-91.0%)
ANSS does not meet all Graham criteria
Trailing Twelve Months (TTM) values provide a view of the company's performance over the last year.
Profitability metrics measure a company's ability to generate earnings relative to its revenue, operating costs, and other relevant metrics. Higher values generally indicate better performance.
Return on Equity (ROE)
Measures how efficiently a company uses its equity to generate profits
10.05%
Higher values indicate better returns for shareholders
TTM (as of 2025-04-30)
Gross Profit Margin
Percentage of revenue retained after accounting for cost of goods sold
88.76%
Higher values indicate better efficiency in production
TTM (as of 2025-04-30)
Net Profit Margin
Percentage of revenue retained after accounting for all expenses
22.62%
Higher values indicate better overall profitability
TTM (as of 2025-04-30)
ANSS displays an operating profit margin of 28.70%, which is indicative of effective management in operating expenses and a strong operational efficiency.
The net profit margin stands at 22.62%, demonstrating the company's ability to convert revenue into actual profit after all expenses.
Financial health metrics assess a company's ability to meet its financial obligations and its overall financial stability.
Debt to Equity Ratio
Total debt divided by total equity
0.14x
Lower values indicate less financial leverage and risk
Less than 1.0 is conservative, 1.0-2.0 is moderate, >2.0 indicates high risk
Q4 2024
Current Ratio
Current assets divided by current liabilities
3.01x
Higher values indicate better short-term liquidity
Less than 1.0 is concerning, 1.0-2.0 is adequate, greater than 2.0 is good
Q4 2024
The debt-to-equity ratio of 0.14 indicates a conservative use of debt, suggesting that ANSS is financially stable and less vulnerable to economic downturns.
With a current ratio of 3.01 and a quick ratio of 3.01, ANSS has a strong liquidity position, indicating its ability to meet short-term obligations comfortably.
Meeting Expectations
Higher values indicate better execution and credibility
Recent Results
EPS
ANSYS has a highly recurring business model with 83% of total ACV coming from recurring sources, which provides a strong financial foundation and contributes to unwavering demand for their products.
The company has a broad and diverse business model across various industries, which reduces dependence on any single sector. This is evidenced by strong demand across high-tech, semiconductors, aerospace and defense, and automotive sectors.
ANSYS reported a gross margin of 91% and an operating margin of 34.1%, which demonstrates strong profitability and operating leverage.
The recent restrictions on sales to certain Chinese entities have introduced delays and potential losses, affecting revenue expectations and growth in the region.
ANSYS is focusing on electrification, autonomy, and software-defined vehicles, which are critical areas for growth in the automotive sector. Their simulation technology is enhancing customer capabilities in these areas.
The company maintains a robust pipeline with strong demand for its technology across various industries, indicating potential for sustained growth despite headwinds.
The anticipated impact of ongoing export restrictions in China is expected to mute growth in 2024, with estimates of $10 million to $30 million in ACV and revenue losses.
