On May 29, Autodesk declined 7.79% in regular trading, trading at $219.59/share, with trading volume of $141 million. The sell-off was triggered by a combination of flat full-year earnings guidance and a large-scale acquisition announcement, despite a Q1 earnings beat.

Autodesk reported fiscal Q1 adjusted EPS of $2.99, beating the consensus estimate of $2.84 by 5.28%, while revenue of $1.934 billion also exceeded the $1.893 billion expectation, representing 18.43% year-over-year growth. Net income surged 223% year-over-year to $491 million. However, the company's full-year adjusted EPS guidance of $12.40-$12.65 merely matched the FactSet consensus of $12.42, failing to deliver a meaningful raise.

Simultaneously, Autodesk announced a $3.6 billion all-cash acquisition of maintenance software company MaintainX, planning to fund approximately $1.6 billion in cash with the remainder through debt financing. The market expressed concern over increased financial leverage. With the stock having already risen 3.08% in the prior session on optimistic expectations, the lack of an upside surprise in guidance combined with acquisition-related leverage risk triggered a classic sell-the-news reaction. Morgan Stanley also lowered its price target to $315 from $350 while maintaining an Overweight rating.

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