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Adobe ADBE recently announced the closure of the buyout of Workfront, a provider of work management platform.
The deal worth about $1.5 billion is expected to enhance the capabilities of Adobe’s Experience Cloud offerings. It will also strengthen the company’s overall offerings by adding the work allocation tool to its portfolio.
Workfront is the leading work management platform for marketers. It has more than 3,000 customers and 1 million users.
Therefore, Workfront’s platform — which has already gained solid popularity — will allow Adobe to capitalize on growing demand for the workflow management software in this data-driven world.
Alex Shootman, the CEO of Workfront, will continue to lead the Workfront team and report to Mr. Anil Chakravarthy.
Adobe Inc. Price and Consensus
Adobe Inc. price-consensus-chart | Adobe Inc. Quote
The acquisition is in sync with the company’s strategy of bolstering online marketing capabilities, which in turn, will drive its momentum among customers.
The deal will make Adobe Experience Cloud more collaborative. This is in line with the company’s growing efforts toward the advancement of Experience Cloud.
Per a Grand View Research report, the global workflow management system market is expected to witness a CAGR of 27.7% during the 2019-2025 period.
Per the Fortune Business Insights data, the worldwide task management software market is anticipated to hit $4.5 billion by 2026 at a CAGR of 13.3% between 2019 and 2026.
We note that this latest move will aid Adobe in penetrating rapidly into these potential markets.
Moreover, the deal holds promise in this coronavirus-hit world and highlights the importance of work management tools that have become crucial for companies to ensure that work from home can be carried out in an uninterrupted way.
Zacks Rank & Price Performance
Adobe, which has a market cap of roughly $236.1 billion, currently carries a Zacks Rank #4 (Sell). In the past year, the company’s shares have returned 60.3% compared with the industry’s rally of 34.7%.
Stocks to Consider
Some better-ranked stocks in the broader technology sector include Marchex MCHX, Overstock.com OSTK and Maxim Integrated Products, Inc. MXIM, each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Long-term earnings growth for Marchex, Overstock.com, and Maxim is currently projected at 15%, 20% and 10%, respectively.
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