Engineering simulation software provider Ansys (NASDAQ:ANSS) will be reporting results tomorrow after market close. Here's what you need to know.

ANSYS beat analysts' revenue expectations by 1.2% last quarter, reporting revenues of $805.1 million, up 15.9% year on year. It was a very strong quarter for the company, with revenue and EPS exceeding expectations.

Is ANSYS a buy or sell going into earnings? Read our full analysis here, it's free.

This quarter, analysts are expecting ANSYS's revenue to grow 8.9% year on year to $555 million, slowing from the 19.8% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $1.98 per share.

The majority of analysts covering the company have reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. ANSYS has only missed Wall Street's revenue estimates once over the last two years, exceeding top-line expectations by 2.2% on average.

Looking at ANSYS's peers in the vertical software segment, only Cadence has reported results so far. It met analysts' revenue estimates, posting year-on-year sales declines of 1.2%. The stock was down 7.3% on the results.

Stocks, especially growth stocks where cash flows further in the future are more important to the story, had a good end of 2023. But the beginning of 2024 has seen more volatile stock performance thanks to mixed inflation data, and while some of the vertical software stocks have fared somewhat better, they have not been spared, with share prices down 3.5% on average over the last month. ANSYS is down 5.1% during the same time and is heading into earnings with an average analyst price target of $345.8 (compared to the current share price of $329.87).

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