Adobe Systems (ADBE) Gains As Market Dips: What You Should Know
Adobe Systems (ADBE) closed at $251.76 in the latest trading session, marking a +0.28% move from the prior day. This move outpaced the S&P 500’s daily loss of 0.55%. Meanwhile, the Dow lost 0.5%, and the Nasdaq, a tech-heavy index, lost 0.42%.
Prior to today’s trading, shares of the software maker had lost 4.93% over the past month. This has was narrower than the Computer and Technology sector’s loss of 6.53% and the S&P 500’s loss of 5.71% in that time.
ADBE will be looking to display strength as it nears its next earnings release, which is expected to be December 13, 2018. The company is expected to report EPS of $1.88, up 49.21% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $2.42 billion, up 20.8% from the prior-year quarter.
ADBE’s full-year Zacks Consensus Estimates are calling for earnings of $6.80 per share and revenue of $8.99 billion. These results would represent year-over-year changes of +57.77% and +23.11%, respectively.
It is also important to note the recent changes to analyst estimates for ADBE. These revisions typically reflect the latest short-term business trends, which can change frequently. 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. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.18% higher. ADBE is currently a Zacks Rank #2 (Buy).
Looking at its valuation, ADBE is holding a Forward P/E ratio of 36.92. This valuation marks a premium compared to its industry’s average Forward P/E of 31.38.
Meanwhile, ADBE’s PEG ratio is currently 2.25. 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 2.17 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 97, which puts it in the top 38% 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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