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1. Company Snapshot

1.a. Company Description

Altair Engineering Inc., together with its subsidiaries, provides software and cloud solutions in the areas of simulation, high-performance computing, data analytics, and artificial intelligence worldwide.The company operates in two segments, Software and Client Engineering Services.The Software segment includes solvers and optimization technology products, high-performance computing software applications and hardware products, modeling and visualization tools, data analytics and analysis products, and Internet of Things platform and analytics tools, as well as support and the complementary software products.


This segment also offers software technologies in the areas of computational fluid dynamics and fatigue, manufacturing process simulation, and cost estimation for the applications in marine, motorcycle, aerospace, chemical, and architecture industries; and software-related services, such as consulting, implementation, and training services that focuses on the product design and development expertise and analysis from the component level up to complete product engineering at various stage of the lifecycle.The Client Engineering Services segment provides client engineering services.In addition, the company is involved in the development and sale of solid state lighting technology along with communication and control protocols based on its intellectual property for the direct replacement of fluorescent light tubes with LED lamps.


Its integrated suite of software optimizes design performance across various disciplines, including structures, motion, fluids, thermal management, electromagnetics, system modeling, and embedded systems.The company's customers include universities, government agencies, manufacturers, pharmaceutical firms, banking, financial services, and insurance, weather prediction agencies, and electronics design companies.Altair Engineering Inc.


was incorporated in 1985 and is headquartered in Troy, Michigan.

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1.b. Last Insights on ALTR

Altair Engineering's recent performance was driven by several positive factors. The company announced the approval of its proposed merger with Siemens, which will likely provide enhanced capabilities and expand its market reach. Additionally, Altair unveiled next-level enhancements within its Altair HPCWorks 2025 platform, further solidifying its position as a leading high-performance computing and cloud provider. Moreover, the company joined the Piedmont Aerospace Cluster, positioning itself for growth in the aerospace sector. These developments showcase Altair's commitment to innovation and strategic partnerships, creating a strong foundation for future growth.

1.c. Company Highlights

2. Transcript Summary

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3. NewsRoom

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Altair and JetZero Join Forces to Propel Aerospace Innovation

Mar -20

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Altair One® Cloud Innovation Gateway Achieves Seamless Integration with NVIDIA Omniverse Blueprint for Real-Time Digital Twins

Mar -19

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Altair to Showcase Leading AI, Simulation, and HPC Technologies at Hannover Messe 2025

Mar -11

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Altair Joins the Piedmont Aerospace Cluster

Feb -25

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Altair Engineering (ALTR) Q4 Earnings Lag Estimates

Feb -20

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Altair Announces Fourth Quarter and Full Year 2024 Financial Results

Feb -20

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Altair Releases Altair® HyperWorks® 2025

Feb -19

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Altair and LTTS Launch 5G-6G Wireless Center of Excellence to Shape the Future of Telecommunications Innovation

Feb -13

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.88%)

6. Segments

Software

Expected Growth: 9%

Altair Engineering Inc.'s software growth is driven by increasing adoption of simulation-driven design, rising demand for digital twins, and growing need for IoT and AI integration. Additionally, the company's expanding presence in emerging markets, strategic acquisitions, and strong partnerships with industry leaders contribute to its high growth rate.

Client Engineering Services

Expected Growth: 7%

Altair's Client Engineering Services growth is driven by increasing demand for simulation-driven design and engineering solutions, expansion into new industries, and strategic partnerships. Additionally, the company's focus on digital twin technology, electrification, and sustainability initiatives resonates with clients, leading to a 7% growth rate.

All Other

Expected Growth: 6%

Altair Engineering Inc.'s 'All Other' segment growth is driven by increasing demand for its software solutions in non-core markets, expansion into new geographies, and strategic acquisitions. The company's investments in emerging technologies like AI, machine learning, and IoT also contribute to its growth. Additionally, the segment benefits from cross-selling opportunities and a strong partner network.

7. Detailed Products

Altair HyperWorks

A comprehensive simulation and analysis software platform that enables users to design, simulate, and optimize complex products and systems.

Altair Inspire

A generative design and topology optimization software that enables users to create innovative and efficient designs.

Altair Radioss

A comprehensive finite element analysis software that enables users to simulate and analyze the behavior of complex systems and products.

Altair OptiStruct

A structural analysis and optimization software that enables users to optimize the performance of complex systems and products.

Altair AcuSolve

A computational fluid dynamics (CFD) software that enables users to simulate and analyze the behavior of fluids and gases.

Altair PBS Works

A workload management and job scheduling software that enables users to manage and optimize high-performance computing (HPC) workloads.

Altair Knowledge Studio

A machine learning and predictive analytics software that enables users to build, deploy, and manage predictive models.

8. Altair Engineering Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Altair Engineering Inc. has a moderate threat of substitutes due to the presence of other simulation and data analytics software providers in the market.

Bargaining Power Of Customers

Altair Engineering Inc. has a low bargaining power of customers due to its strong brand reputation and the complexity of its products, making it difficult for customers to switch to alternative solutions.

Bargaining Power Of Suppliers

Altair Engineering Inc. has a moderate bargaining power of suppliers due to its dependence on a few key suppliers for certain components and services, but it also has some negotiating power due to its large scale of operations.

Threat Of New Entrants

Altair Engineering Inc. has a low threat of new entrants due to the high barriers to entry in the simulation and data analytics software market, including the need for significant investments in research and development.

Intensity Of Rivalry

Altair Engineering Inc. operates in a highly competitive market with several established players, leading to a high intensity of rivalry among competitors.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 32.26%
Debt Cost 3.95%
Equity Weight 67.74%
Equity Cost 11.07%
WACC 8.77%
Leverage 47.63%

11. Quality Control: Altair Engineering Inc. passed 6 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Toast

A-Score: 4.6/10

Value: 0.9

Growth: 9.1

Quality: 6.4

Yield: 0.0

Momentum: 7.5

Volatility: 4.0

1-Year Total Return ->

Stock-Card
Altair Engineering

A-Score: 4.5/10

Value: 2.0

Growth: 6.7

Quality: 5.3

Yield: 0.0

Momentum: 7.0

Volatility: 6.0

1-Year Total Return ->

Stock-Card
Robinhood Markets

A-Score: 4.5/10

Value: 0.3

Growth: 7.2

Quality: 7.0

Yield: 0.0

Momentum: 10.0

Volatility: 2.3

1-Year Total Return ->

Stock-Card
Informatica

A-Score: 4.1/10

Value: 4.1

Growth: 6.1

Quality: 4.8

Yield: 0.0

Momentum: 4.0

Volatility: 5.7

1-Year Total Return ->

Stock-Card
Affirm

A-Score: 3.8/10

Value: 0.7

Growth: 9.1

Quality: 3.1

Yield: 0.0

Momentum: 8.0

Volatility: 2.0

1-Year Total Return ->

Stock-Card
HashiCorp

A-Score: 3.8/10

Value: 4.2

Growth: 4.4

Quality: 3.6

Yield: 0.0

Momentum: 5.5

Volatility: 5.0

1-Year Total Return ->

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

111.85$

Current Price

111.85$

Potential

-0.00%

Expected Cash-Flows