Adobe Systems (ADBE) closed at $406.76 in the latest trading session, marking a +1.92% move from the prior day. This change outpaced the S&P 500’s 1.86% gain on the day. Elsewhere, the Dow gained 1.98%, while the tech-heavy Nasdaq added 0.24%.
Coming into today, shares of the software maker had lost 2.34% in the past month. In that same time, the Computer and Technology sector lost 13.4%, while the S&P 500 lost 12.37%.
Adobe Systems will be looking to display strength as it nears its next earnings release. On that day, Adobe Systems is projected to report earnings of $3.30 per share, which would represent year-over-year growth of 8.91%. Meanwhile, our latest consensus estimate is calling for revenue of $4.34 billion, up 13.12% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $13.58 per share and revenue of $17.83 billion. These totals would mark changes of +8.81% and +12.93%, respectively, from last year.
Investors might also notice recent changes to analyst estimates for Adobe Systems. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company’s business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. Adobe Systems is currently sporting a Zacks Rank of #3 (Hold).
Looking at its valuation, Adobe Systems is holding a Forward P/E ratio of 29.38. This valuation marks a premium compared to its industry’s average Forward P/E of 28.33.
Meanwhile, ADBE’s PEG ratio is currently 1.69. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company’s expected earnings growth rate. ADBE’s industry had an average PEG ratio of 2.19 as of yesterday’s close.
The Computer – Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 91, putting it in the top 37% of all 250+ industries.
The Zacks Industry Rank includes is listed in order 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.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.
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