In the latest trading session, Adobe Systems (ADBE) closed at $351.34, marking a +1.02% move from the previous day. The stock outpaced the S&P 500's daily loss of 0.38%. Elsewhere, the Dow lost 0.46%, while the tech-heavy Nasdaq added 0.17%.
Heading into today, shares of the software maker had lost 1.93% over the past month, outpacing the Computer and Technology sector's loss of 5.23% and the S&P 500's loss of 4.88% in that time.
Investors will be hoping for strength from ADBE as it approaches its next earnings release, which is expected to be March 12, 2020. The company is expected to report EPS of $2.23, up 30.41% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $3.04 billion, up 17.04% from the prior-year quarter.
For the full year, our Zacks Consensus Estimates are projecting earnings of $9.80 per share and revenue of $13.15 billion, which would represent changes of +24.52% and +17.68%, respectively, from the prior year.
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. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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 ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.06% higher within the past month. ADBE is currently a Zacks Rank #2 (Buy).
Looking at its valuation, ADBE is holding a Forward P/E ratio of 35.48. For comparison, its industry has an average Forward P/E of 29.03, which means ADBE is trading at a premium to the group.
Investors should also note that ADBE has a PEG ratio of 2.18 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. ADBE's industry had an average PEG ratio of 2.22 as of yesterday's close.
The Computer - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 35, putting it in the top 14% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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Adobe Systems Incorporated (ADBE) : Free Stock Analysis Report
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