In the latest close session, Adobe Systems (ADBE) was up +2.85% at $279.69. The stock outpaced the S&P 500's daily loss of 0.51%. Meanwhile, the Dow experienced a rise of 0.53%, and the technology-dominated Nasdaq saw a decrease of 1.51%.
The software maker's stock has dropped by 19.07% in the past month, falling short of the Computer and Technology sector's loss of 0.27% and the S&P 500's gain of 0.93%.
Market participants will be closely following the financial results of Adobe Systems in its upcoming release. The company's upcoming EPS is projected at $5.88, signifying a 15.75% increase compared to the same quarter of the previous year. Alongside, our most recent consensus estimate is anticipating revenue of $6.28 billion, indicating a 9.92% upward movement from the same quarter last year.
Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $23.47 per share and revenue of $26.04 billion, indicating changes of +12.08% and +9.54%, respectively, compared to the previous year.
It is also important to note the recent changes to analyst estimates for Adobe Systems. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. The Zacks Consensus EPS estimate has moved 0.06% higher within the past month. Currently, Adobe Systems is carrying a Zacks Rank of #3 (Hold).
Valuation is also important, so investors should note that Adobe Systems has a Forward P/E ratio of 11.59 right now. This represents a discount compared to its industry average Forward P/E of 18.28.
It's also important to note that ADBE currently trades at a PEG ratio of 0.87. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The average PEG ratio for the Computer - Software industry stood at 1.47 at the close of the market yesterday.
The Computer - Software industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 90, positioning it in the top 37% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.
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Adobe Inc. (ADBE): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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