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By Brendan Gilmartin

Autodesk (NASDAQ:ADSK) will report 3Q 2012 earnings after the closing bell on Tuesday, November 15. Last August, the engineering software maker’s shares fell sharply, despite posting 2Q EPS and revenue above consensus, with in-line guidance.

Coming into the 3Q report, Autodesk projected Non-GAAP Earnings Per Share in the range of $0.38 to $0.42 on revenue of $535 mln to $550 mln. Current estimates are toward the high end of the company’s guidance (Non GAAP EPS: $0.41/Revenue: $547.27 mln, Source: Yahoo!). Note that revenue is forecast to come in at $583.09 mln next quarter (4Q 2012), a 10.5% year/year increase and 6.5% sequential gain in a more challenging economic backdrop.

The macro picture, particularly in Europe (EMEA accounts for ~40% of Autodesk revenue) is among the chief concerns facing Autodesk, while expectations are already toward the high end of the previously-stated forecast. With the shares up more than 30% above the October lows, positive results may well be priced in, with the shares now trading at 31.4x trailing earnings, a premium to the 5-year average. Meanwhile, gross margins near 90% are also at the higher end of the range over the past 10 years.

Chart Review

  • Autodesk shares are up more than 30% off the early October low, recently bumping into a stiff resistance barrier near $36. The $36-level was previously support in mid-June and mid-July.
  • On a positive earnings release, the next level above the aforementioned $36 is the 200-Day SMA near $37, followed by the July peak near $40.
  • Support is seen at the 20-Day SMA near $33.50, with potential downside risk to $30.00, just below the 50-Day SMA.

(Click charts to expand)

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Source: Volatility Alert For Autodesk Q3 2012