PTC Software Is Sticky Due to Its Mission-Critical Nature

PTC operates in the high-end computer-assisted design software market, but we view this market as mature and don’t foresee significant top-line growth in this area. PTC’s foray into growth areas such as "Internet of Things," AR, and midmarket CAD, on the other hand, will significantly add growth to the top line, in our view, as we expect PTC’s revenue mix to shift significantly to these areas over the next 10 years. While we’re still confident in PTC’s narrow moat, we’ve assigned a stable moat trend rating to the company due to the relative nascence of its growth areas.