Adobe Systems (ADBE) closed at $333.26 in the latest trading session, marking a +1.22% move from the prior day. The stock outpaced the S&P 500’s daily gain of 0.53%. Elsewhere, the Dow gained 0.52%, while the tech-heavy Nasdaq added 0.52%.
Shares of the software maker have depreciated by 10.4% over the course of the past month, underperforming the Computer and Technology sector’s gain of 2.01%, and the S&P 500’s gain of 0.71%.
Investors will be eagerly watching for the performance of Adobe Systems in its upcoming earnings disclosure. On that day, Adobe Systems is projected to report earnings of $5.39 per share, which would represent year-over-year growth of 12.06%. Our most recent consensus estimate is calling for quarterly revenue of $6.1 billion, up 8.85% from the year-ago period.
Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $20.77 per share and revenue of $23.67 billion, indicating changes of +12.76% and +10.06%, respectively, compared to the previous year.
Any recent changes to analyst estimates for Adobe Systems should also be noted by investors. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As a result, upbeat changes in estimates indicate analysts’ favorable outlook on the business health and profitability.
Based on our research, we believe these estimate revisions are directly related to near-term stock moves. To exploit this, we’ve formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the past month, there’s been a 0.01% rise in the Zacks Consensus EPS estimate. Adobe Systems is currently sporting a Zacks Rank of #3 (Hold).
Investors should also note Adobe Systems’s current valuation metrics, including its Forward P/E ratio of 15.85. This valuation marks a discount compared to its industry average Forward P/E of 27.39.
Meanwhile, ADBE’s PEG ratio is currently 1.21. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company’s expected earnings growth rate into account. The Computer – Software industry currently had an average PEG ratio of 2.05 as of yesterday’s close.
The Computer – Software industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 94, this industry ranks in the top 39% of all industries, numbering over 250.
