I'm a fan of the industrial and process automation sector, as I
believe automation is a major factor in reducing operating costs across a
variety of industries. As a leading provider of process optimization
software, and one of the very few that is not captive within a much
larger company, makes Aspen Technology (AZPN) a company worth knowing.
Valuation
is problematic here. A forward EV/EBITDA ratio of over 31 and a forward
EV/revenue ratio of over 10 certainly underline some of my concerns.
Even though potential long-term free cash flow growth of 10% is quite
attractive, it takes some pretty unconventional thinking to argue that
Aspen is any kind of bargain today.
Read more here:
Aspen Technology - Trees Don't Grow To The Sky
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