The most recent trading session ended with Adobe Systems (ADBE) standing at $413.10, reflecting a +1.33% shift from the previouse trading day's closing. The stock lagged the S&P 500's daily gain of 2.05%. Elsewhere, the Dow saw an upswing of 1.78%, while the tech-heavy Nasdaq appreciated by 2.47%.
Shares of the software maker witnessed a gain of 10.6% over the previous month, beating the performance of the Computer and Technology sector with its gain of 8.52% and the S&P 500's gain of 5.21%.
Market participants will be closely following the financial results of Adobe Systems in its upcoming release. The company plans to announce its earnings on June 12, 2025. On that day, Adobe Systems is projected to report earnings of $4.96 per share, which would represent year-over-year growth of 10.71%. At the same time, our most recent consensus estimate is projecting a revenue of $5.79 billion, reflecting an 8.99% rise from the equivalent quarter last year.
ADBE's full-year Zacks Consensus Estimates are calling for earnings of $20.36 per share and revenue of $23.42 billion. These results would represent year-over-year changes of +10.53% and +8.89%, respectively.
Furthermore, it would be beneficial for investors to monitor any recent shifts in analyst projections for Adobe Systems. These revisions typically reflect the latest short-term business trends, which can change frequently. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the past month, there's been no change in the Zacks Consensus EPS estimate. Adobe Systems presently features a Zacks Rank of #4 (Sell).
In terms of valuation, Adobe Systems is presently being traded at a Forward P/E ratio of 20.02. This expresses a discount compared to the average Forward P/E of 26.73 of its industry.
Investors should also note that ADBE has a PEG ratio of 1.61 right now. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. ADBE's industry had an average PEG ratio of 2.43 as of yesterday's close.
The Computer - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 73, which puts it in the top 30% of all 250+ industries.
The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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Adobe Inc. (ADBE): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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