In its research note, Citi points out that the 3D modeling specialist's performance presented a mixed picture over the first three months of the year. Growth was primarily driven by a sharp acceleration at its Centric Software subsidiary, which serves the consumer goods industry, bolstered by both large contract wins and favorable momentum in subscription levels.

Despite this encouraging start to the year, the analyst notes that several factors remain at the forefront of investor concerns for the remainder of the fiscal year.

From the broker's perspective, achieving 2026 financial targets will require an acceleration in growth rates over the coming quarters. This trajectory will notably depend on the performance of the Medidata life sciences division, which continues to face operational headwinds.

A high bar and full valuation

Furthermore, concerns regarding the potential impact of AI on the software sector remain prevalent among investors, the analyst argues, even if the broker highlights that industrial software currently maintains a degree of resilience in the face of these technological shifts.

Nevertheless, Citi anticipates a higher execution bar for the rest of the year, particularly in the second and third quarters. This pressure is largely due to a demanding basis of comparison and an unfavorable economic environment.

In this context, the group's ability to maintain sustained growth momentum will be a decisive factor for investor confidence, the note continues, at a time when the valuation already reflects much of the business model's strengths.

According to its calculations, the group's valuation reflects an adjusted free cash flow yield of approximately 5%, above peers such as SAP or Autodesk. This suggests limited upside potential in the absence of a significant improvement in the operational outlook.