Evercore Keeps Buy on Adobe (ADBE) Despite AI Monetization Concerns, Market Skepticism

Adobe Inc. (NASDAQ:ADBE) is one of the best value stocks in Goldman Sachs’ portfolio. The company is facing increasing scrutiny over the monetization of its generative AI capabilities, which have fallen short of the expectations of some analysts. Adobe’s investments in these capabilities were expected to boost its Digital Media ARR growth. However, the results have been slower than anticipated, as Adobe continues to prioritize broader adoption. Due to the slower monetization and lack of near-term catalysts, analysts from Morgan Stanley and Mizuho Securities downgraded the stock to Hold on September 24. Both of them trimmed their price target sharply to $450 from $520 previously.

On the positive side, on the same day, Evercore ISI analyst Kirk Materne reiterated his bullish stance with a Buy rating, with an unchanged price target of $450. The analyst had already lowered his price target from $475 in his earlier note on September 12, following the company’s Q3 FY 2025 results.

While the company’s results had exceeded most metrics, Materne believes Adobe’s valuation already factors in a lot of uncertainty and doubts over its long-term growth trajectory. However, he also argues that it will take time for investor sentiment to turn positive, and such a change will require the company to show results on its AI-led growth initiatives and address competitive risks.

Adobe Inc. (NASDAQ:ADBE) is a global leader in creative, document, and digital experience software, providing tools for content creation, design, marketing, analytics, and customer engagement.

While we acknowledge the potential of ADBE as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.