Taking on analysts’ expectations and winning: Adobe Inc. (ADBE)

Adobe Inc. (NASDAQ: ADBE) stock fell -0.25% on Thursday to $552.16 against a previous-day closing price of $553.56. With 4.53 million shares changed hands, the volume of the stock remained heavier than its average volume of 3.08 million shares. During the session, the Software – Infrastructure company that operates in wider Technology sector, reached to the highest price of $555.19 whereas the lowest price it dropped to was $544.41. The 52-week range on ADBE shows that it touched its highest point at $570.24 and its lowest point at $274.73 during that stretch. It currently has a 1-year price target of $566.18. Beta for the stock currently stands at 1.33.

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Price Performance and Earnings:

Stock performance is one of the indicators that investors use to determine whether they will profit from a stock. The price performance of ADBE was down-trending over the past week, with a drop of -1.48%, but this was up by 6.45% over a month. Three-month performance surged to 15.15% while six-month performance rose 65.51%. The stock gained 49.88% in the past year, while it has gained 64.07% so far this year. A look at the trailing 12-month EPS for ADBE yields 10.47 with Next year EPS estimates of 17.79. For the next quarter, that number is 4.06. This implies an EPS growth rate of 0.70% for this year and 13.05% for next year. EPS is expected to grow by 14.07% annually over the next five years; however, over the past five years, the company experienced an annual growth rate of 24.50%.

Float and Shares Shorts:

At present, 458.00 million ADBE shares are outstanding with a float of 454.42 million shares on hand for trading. On Aug 30, 2023, short shares totaled 4.25 million, which was 0.93% higher than short shares on Jul 30, 2023. In addition to Mr. Shantanu Narayen as the firm’s Chairman & CEO, Mr. Daniel J. Durn serves as its CFO and Exec. VP of Fin., Technology Services & Operations.

Institutional Ownership:

Through their ownership of 86.40% of ADBE’s outstanding shares, institutional investors have majority control over the company. Other institutions hold 48.62% of ADBE, in contrast to 35.09% held by mutual funds. Shares owned by individuals account for 0.65%. As the largest shareholder in ADBE with 8.29% of the stake, The Vanguard Group, Inc. holds 37,762,870 shares worth 37,762,870. A second-largest stockholder of ADBE, BlackRock Fund Advisors, holds 23,247,117 shares, controlling over 5.10% of the firm’s shares. SSgA Funds Management, Inc. is the third largest shareholder in ADBE, holding 18,862,098 shares or 4.14% stake. With a 3.13% stake in ADBE, the Vanguard Total Stock Market ETF is the largest stakeholder. A total of 14,283,726 shares are owned by the mutual fund manager. The Vanguard 500 Index Fund, which owns about 2.41% of ADBE stock, is the second-largest Mutual Fund holder. It holds 10,985,336 shares valued at 6.0 billion. Invesco QQQ Trust holds 1.72% of the stake in ADBE, owning 7,833,455 shares worth 4.28 billion.

Analysts Ratings:

Reading analyst opinions is an effective way to decide where to invest, and there are several opinions available for ADBE since 0 analysts follow the stock currently. In the same way, a target price assigned to a stock can also reveal much about its potential. With ADBE analysts setting a high price target of $660.00 and a low target of $428.00, the average target price over the next 12 months is $580.80. Based on these targets, ADBE could surge 19.53% to reach the target high and fall by -22.49% to reach the target low. Reaching the average price target will result in a growth of 5.19% from current levels.

EPS: Estimates vs Actual

It is also common to use earnings estimates to evaluate a firm’s growth potential and to determine trading strategy.

Summary of Insider Activity:

Insiders traded ADBE stock several times over the past three months with 31 Buys and 41 Sells. In these transactions, 23,032 shares were bought while 55,546 shares were sold. The number of buy transactions has increased to 138 while that of sell transactions has risen to 161 over the past year. The total number of shares bought during that period was 200,135 while 199,058 shares were sold.

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