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Adobe Systems Incorporated Message Board

  • jamesjr.estey jamesjr.estey Dec 16, 2013 3:02 PM Flag

    The FACTS about ADBE share repurchase program

    Per Form 8-K as of Q#3 (FY 2013), ADBE said it had $134.3 million remaining under an agreement with an undisclosed Financial Institution to repurchase shares of its own stock, and another $800 million authorized by the Board as part of a $2 Billion share repurchase plan thru the end of FY 2015. In Q#4 of FY 2013, ADBE booked $400 million in share repurchases, which would leave them another $400 million (direct repurchases) + $134.3 million (repurchases thru 3rd party) for share repurchases. The average repurchase price thru the 3rd party was $43.78 for the 9 months ending August 30, 2013. And $32.17 for the 9 months ending August 30, 2013.
    Now its nice to have share repurchase program, but if you don't have the excess cash, well u just cannot repurchases shares. As of 11/30/2013, ADBE had Long Term Liabilities of $1.5 Billion but only $834 Million in cash available to pay this Long-Term Debt plus their Accounts Payables. Yes, ADBE reports having $2.4 Billion in "Short-Term Investments" so its not as if they could not repurchase shares. Now at $60 per share, ADBE could totally exhaust their Repurchase Program by presently buying 8.9 million shares for $534 million. But this is not going to happen, because (#1) ADBE knows their shares r trading in the stratosphere; (#2) the amount of cash available and authorized for share repurchases is only about 2 days worth of trading volume; and (#3) this share repurchase program is supposed to last for 2 more full years until the ending of FY 2015.

    Sentiment: Strong Sell

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    • all you have to do is go to sec edgar, and view the rash on insider selling in this stock since
      October... management is scratching their heads on this move as much as anyone else..
      otherwise they wouldn't have sold so strongly as they did prior to earnings. With forecasts lowered, for the next 4 quarters, anticipate not only continued and increasing insider selling, but top holding funds
      selling large portions of their holdings. The rotations can start anytime, but surely by January
      when many factors will start to begin changing this market.
      By the way, not a bad racket, huh ? Put the company in large debt to install a share buy program, then offset its impact with insider options, sell insider stock at highs created by the debt you issued. Scam.

      Sentiment: Strong Sell

      • 1 Reply to snow.ball7
      • hey Snowball....dont worry @ yr puts..i hv feeling that if taper happens ADBE is the weakest one to go down 1st. I feel the ywil start taper with little amount and that will bring small correction in market...hold yr 47, 50, 55P and see the game..bought 60p on friday but i was down a lot by WOD so this morning sold cost -to cost. Now regretting...i shud have kept it till today EOD.

        Sentiment: Strong Sell

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