Adobe Systems (ADBE) Dips More Than Broader Markets: What You Should Know
Adobe Systems (ADBE) closed at $375.23 in the latest trading session, marking a -1.08% move from the prior day. This change lagged the S&P 500's daily loss of 0.61%. At the same time, the Dow lost 0.1%, and the tech-heavy Nasdaq lost 0.67%.
Heading into today, shares of the software maker had gained 14% over the past month, lagging the Computer and Technology sector's gain of 17.44% and outpacing the S&P 500's gain of 8.32% in that time.
Wall Street will be looking for positivity from Adobe Systems as it approaches its next earnings report date. The company is expected to report EPS of $3.66, up 8.61% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $4.61 billion, up 8.27% from the prior-year quarter.
For the full year, our Zacks Consensus Estimates are projecting earnings of $15.26 per share and revenue of $19.19 billion, which would represent changes of +11.31% and +9.01%, respectively, from the prior year.
Investors might also notice recent changes to analyst estimates for Adobe Systems. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an 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 has moved 0.61% lower. Adobe Systems currently has a Zacks Rank of #3 (Hold).
In terms of valuation, Adobe Systems is currently trading at a Forward P/E ratio of 24.86. This valuation marks a discount compared to its industry's average Forward P/E of 28.5.
It is also worth noting that ADBE currently has a PEG ratio of 1.89. 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 Computer - Software was holding an average PEG ratio of 2.11 at yesterday's closing price.
The Computer - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 106, putting it in the top 43% 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 follow all of these stock-moving metrics, and many more, on Zacks.com.
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