Adobe Stock News

Adobe has been one of the worst-performing, megacap tech stocks year to date.

Adobe has been able to rapidly embed Gen AI features into its products, which are getting a lot of traction. It has also been able to generate more sales but these are progressing gradually, as it reshapes its product portfolio in a market that has been disrupted. Adobe's inability to hike pricing hints that the competition is strong while it has lost the first-mover advantage in image creation.

Both stocks are competing in the artificial intelligence tech race.

At present, Adobe's AI growth drivers, margin stability, and reasonable price tag combine into a compelling package for investors. Competition is a risk consideration, especially following the Figma deal's collapse. That said, Adobe's strong fundamentals, distribution advantages, and strategic positioning justify an upgrade to a positive rating.

I upgraded Adobe to a "buy" with a $518 price target, driven by strong GenAI adoption and early signs of revenue acceleration. Despite Q4 guidance missing expectations, Adobe's RPO growth indicates potential revenue acceleration which could improve investor sentiment in the coming quarters. Adobe's Digital Media and Experience segments show robust growth, with significant contributions from Cre...

Adobe continues to exceed guidance while showing strong profitability. Wall Street appears concerned about slowing growth rates, but may be missing the bigger picture. I highlight ADBE's strong balance sheet and mature capital allocation strategy.

Adobe's stock has fallen by more than 20% over the past year, even as fundamentals improved, and there is a good reason for that. Contrary to popular opinion, the stock is not significantly undervalued, but that's not needed to justify a buy rating. It appears that the current momentum in margin improvements could be sustained and this will provide a much-needed tailwind for the share price.

Electronic Arts' EA Sports and Adobe have teamed up to transform the Team Builder mode of EA Sports College Football 25.