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Back to the Drawing Board for Autodesk

I don't believe management can continue to remain seemingly undecided about whether Autodesk will operate as a growth company, which is what the stock presumes, while delivering "mature-level" results. That is to say, the company seems content with slower growth, while choosing to focus on efficiency. I don't have a problem with that. But, certainly, investors are unprepared to make this transition.

In any case, I believe management should do a better job of disclosing not only what Autodesk's next strategic move will be, but the phase of growth that the company is in. As it stands, the performance of the company and the expectations of investors are out of order. Autodesk investors might disagree with this. In fact, I expect that they will. But at $36.75 per share, there's no way to justify paying 3 times the multiple of Microsoft (MSFT) - not when Microsoft is the better value by every measurable standard.

Some will say that I've beaten Autodesk too much. Perhaps I have. But if the stock was not trading at such an inflated P/E ratio, I probably wouldn't have cared as much. I'm not suggesting that Autodesk is going to surprise us with an untimely death next week. Truth be told, the company's fundamentals are strong. But I've seen too many tech investors get burnt on unrealistic expectations.

To that end, I would feel much better if management showed that it had a better understanding of the company's business. I suppose, in time, the lights may suddenly flash. But for investors that wish to still bet big on this company, it may be too late. Until then, I don't have enough faith in management to believe that Autodesk can grow into its current price.

At the time of publication, the author held no position in any of the stocks mentioned.

This article was written by an independent contributor, separate from TheStreet's regular news coverage.

Richard Saintvilus is a co-founder of StockSaints.com where he serves as CEO and editor-in-chief. After 20 years in the IT industry, including 5 years as a high school computer teacher, Saintvilus decided his second act would be as a stock analyst - bringing logic from an investor's point of view. His goal is to remove the complicated aspect of investing and present it to readers in a way that makes sense.

His background in engineering has provided him with strong analytical skills. That, along with 15 years of trading and investing, has given him the tools needed to assess equities and appraise value. Richard is a Warren Buffett disciple who bases investment decisions on the quality of a company's management, growth aspects, return on equity, and price-to-earnings ratio.

His work has been featured on CNBC, Yahoo! Finance, MSN Money, Forbes, Motley Fool and numerous other outlets.

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