NasdaqGS:ADBE

Stock Analysis Report

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Market Cap

US$294.8b

Last Updated

2021/08/03 00:30 UTC

Data Sources

Company Financials +

Executive Summary

Adobe Inc. operates as a diversified software company worldwide. More Details


Snowflake Analysis

Outstanding track record with excellent balance sheet.


Similar Companies

Share Price & News

How has Adobe's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ADBE is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 3% a week.

Volatility Over Time: ADBE's weekly volatility (3%) has been stable over the past year.


Market Performance


7 Day Return

-0.3%

ADBE

-0.5%

US Software

-0.4%

US Market


1 Year Return

38.1%

ADBE

33.6%

US Software

34.4%

US Market

Return vs Industry: ADBE matched the US Software industry which returned 38.6% over the past year.

Return vs Market: ADBE exceeded the US Market which returned 35.9% over the past year.


Shareholder returns

ADBEIndustryMarket
7 Day-0.3%-0.5%-0.4%
30 Day4.3%2.1%-0.4%
90 Day26.1%15.4%4.0%
1 Year38.1%38.1%34.3%33.6%36.5%34.4%
3 Year143.5%143.5%143.7%137.1%62.0%51.9%
5 Year528.2%528.2%353.0%329.5%121.8%97.2%

Long-Term Price Volatility Vs. Market

How volatile is Adobe's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Adobe undervalued compared to its fair value and its price relative to the market?

53.12x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: ADBE ($618.75) is trading above our estimate of fair value ($511.57)

Significantly Below Fair Value: ADBE is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: ADBE is poor value based on its PE Ratio (53.1x) compared to the US Software industry average (50.5x).

PE vs Market: ADBE is poor value based on its PE Ratio (53.1x) compared to the US market (18.2x).


Price to Earnings Growth Ratio

PEG Ratio: ADBE is poor value based on its PEG Ratio (3.9x)


Price to Book Ratio

PB vs Industry: ADBE is overvalued based on its PB Ratio (21.3x) compared to the US Software industry average (6.7x).


Future Growth

How is Adobe forecast to perform in the next 1 to 3 years based on estimates from 26 analysts?

13.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ADBE's forecast earnings growth (13.8% per year) is above the savings rate (2%).

Earnings vs Market: ADBE's earnings (13.8% per year) are forecast to grow slower than the US market (15% per year).

High Growth Earnings: ADBE's earnings are forecast to grow, but not significantly.

Revenue vs Market: ADBE's revenue (12.8% per year) is forecast to grow faster than the US market (9.2% per year).

High Growth Revenue: ADBE's revenue (12.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ADBE's Return on Equity is forecast to be high in 3 years time (39%)


Past Performance

How has Adobe performed over the past 5 years?

32.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ADBE has high quality earnings.

Growing Profit Margin: ADBE's current net profit margins (38.8%) are higher than last year (30.7%).


Past Earnings Growth Analysis

Earnings Trend: ADBE's earnings have grown significantly by 32.8% per year over the past 5 years.

Accelerating Growth: ADBE's earnings growth over the past year (50.5%) exceeds its 5-year average (32.8% per year).

Earnings vs Industry: ADBE earnings growth over the past year (50.5%) exceeded the Software industry 34.7%.


Return on Equity

High ROE: ADBE's Return on Equity (40.3%) is considered outstanding.


Financial Health

How is Adobe's financial position?


Financial Position Analysis

Short Term Liabilities: ADBE's short term assets ($8.1B) exceed its short term liabilities ($6.1B).

Long Term Liabilities: ADBE's short term assets ($8.1B) exceed its long term liabilities ($5.6B).


Debt to Equity History and Analysis

Debt Level: ADBE's debt to equity ratio (29.7%) is considered satisfactory.

Reducing Debt: ADBE's debt to equity ratio has increased from 26.2% to 29.7% over the past 5 years.

Debt Coverage: ADBE's debt is well covered by operating cash flow (169.4%).

Interest Coverage: ADBE's interest payments on its debt are well covered by EBIT (73.5x coverage).


Balance Sheet


Dividend

What is Adobe current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate ADBE's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate ADBE's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if ADBE's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if ADBE's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of ADBE's dividend in 3 years as they are not forecast to pay a notable one for the US market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

3.7yrs

Average management tenure


CEO

Shantanu Narayen (57 yo)

13.67yrs

Tenure

US$45,889,954

Compensation

Mr. Shantanu Narayen has been Chairman of Adobe Inc. (formerly known as Adobe Systems Incorporated) since January 2017 and has been its Chief Executive Officer since December 01, 2007 and President since J...


CEO Compensation Analysis

Compensation vs Market: Shantanu's total compensation ($USD45.89M) is above average for companies of similar size in the US market ($USD11.19M).

Compensation vs Earnings: Shantanu's compensation has been consistent with company performance over the past year.


Leadership Team

Experienced Management: ADBE's management team is considered experienced (3.7 years average tenure).


Board Members

Experienced Board: ADBE's board of directors are considered experienced (4 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: ADBE insiders have only sold shares in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Adobe Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Adobe Inc.
  • Ticker: ADBE
  • Exchange: NasdaqGS
  • Founded: 1982
  • Industry: Application Software
  • Sector: Software
  • Market Cap: US$294.773b
  • Shares outstanding: 476.40m
  • Website: https://www.adobe.com

Number of Employees


Location

  • Adobe Inc.
  • 345 Park Avenue
  • San Jose
  • California
  • 95110-2704
  • United States

Listings


Biography

Adobe Inc. operates as a diversified software company worldwide. Its Digital Media segment provides tools and solutions that enable individuals, teams, and enterprises to create, publish, promote, and mone...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/08/03 00:30
End of Day Share Price2021/08/02 00:00
Earnings2021/06/04
Annual Earnings2020/11/27


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.