By Despite a positive earnings report, investors seem to be selling off shares of software marker Adobe. The recent FactSet survey shows that out of the 12 analysts who updated their recommendations on Thursday, 10 have given Adobe a Buy rating, while two recommend a Hold. The average target price among these analysts is $662, while the premarket trading shows a decline of 6%, with the shares currently valued at $585.98.
Although the numbers for the most recent quarter were in line with expectations, Adobe’s revenue guidance fell short in the eyes of traders. Many were likely hoping for a larger boost to revenue in the near future from the company’s artificial intelligence-powered products.
Despite the recent drop in share value, Adobe has experienced significant growth in the past year, with an increase of 90% in share price over the last 12 months.
D.A. Davidson analysts are optimistic about Adobe’s future and have increased their price target for the stock to $685 from $640 following the earnings report. According to software analyst Gil Luria, “We continue to view Adobe as a name positioned to post quality results despite ongoing macro headwinds given its strong new business momentum and sustainable margin profile.”
Oppenheimer analysts, led by Brian Schwartz, also have confidence in Adobe’s sustained success. They wrote, “Stay the course with Adobe. The stage looks set for Adobe to sustain an enduring and enviable business model that has durable growth with high profit margins over the next several years.” Their price target remains at $660 following Wednesday’s results.
In conclusion, despite some investor hesitation, analysts remain optimistic about Adobe’s potential for future growth and success.
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