Altair Engineering Inc. (ALTR), a provider of software and cloud solutions for simulation, high-performance computing (HPC), and artificial intelligence (AI), completed the acquisition of S-FRAME Software, a structural analysis software platform.
The S-FRAME acquisition expands Altair’s global footprint in the rapidly growing Architecture, Engineering, and Construction (AEC) market, wherein the traditional methods of structural designing will be replaced with predictive, high-performance design, fueled by simulation, the company said. (See Altair Engineering stock charts on TipRanks)
Notably, as per a CIMdata report, the AEC segment is expected to grow at a 14.7% Compound Annual Growth Rate to $11 billion in 2025.
S-FRAME’s platform enables users to analyze, design, and detail structures regardless of geometric complexity, loading conditions, nonlinear effects, design code requirements, or material types.
Therefore, the combined entity’s software offerings will enable architects and civil engineers to broaden the scope of designs and innovations, while maintaining local code requirements.
Commenting on the deal, James R. Scapa, founder and CEO of Altair, said, “By using highly sophisticated performance-based, predictive simulation, architects and designers will be able to be more creative, fueling innovation while increasing safety.”
Following the announcement of the acquisition, Rosenblatt Securities analyst Blair Abernethy reiterated a Buy rating on the stock with a price target of $80, implying 12.8% upside potential to current levels.
Abernethy said, “We are positive on this acquisition as it deepens Altair’s exposure in the growing AEC vertical and complements its existing set of AEC simulation solutions.”
S-FRAME software will be available through Altair Units, which the analyst believes will enable cross-selling of Altair’s AEC solutions to S-FRAME customers and vice-versa.
Overall, the stock has a Moderate Buy consensus rating based on 2 Buys and 3 Holds. The average Altair Engineering price target of $74.33 implies 4.8% upside potential to current levels. Shares have gained 83.4% over the past year.