Between strong share in its core CAD/CAE markets, good margins, healthy cash flow, and a collection of markets that the company may have only penetrated by about 10%, I understand why Dassault Systemes (OTCPK:DASTY) trades at hefty valuation multiples. What's more, when you consider the prices that companies like Siemens (OTCPK:SIEGY) and Hexagon (OTCPK:HXGBY) have paid for acquisitions in the space, I can understand why some investors are comfortable with the multiples, and particularly considering the possibility that revenue growth can be healthy for a number of years. While this is too expensive to be a core holding in my own portfolio, it's hard not to like a business that is at the heart of industrial software at a time when many companies like Honeywell (NYSE:HON) and General Electric (NYSE:GE) are talking up the importance of software and digitization in industrial markets over the next five to 10 years.
Read the full article here:
Dassault Systemes Priced Like The Leader It Is