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Adobe Inc ADBE

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Adobe’s Digital Experience Drives Q3 Strength; FVE Up to $610

Dan Romanoff, CPA Senior Equity Analyst

Analyst Note

| Dan Romanoff, CPA |

Wide-moat Adobe reported strong third-quarter results, including upside to guidance for revenue and non-GAAP EPS, and provided a better than expected quarterly outlook. We continue to see strength in all segments and geographies regarding quarterly results and are pleased to see continued strength in the digital experience, or DX, segment, which we believe is critical for growth longer-term. We think results continue to support our investment case that Adobe will continue to dominate the creative segment, and its well-rounded portfolio, including Magento and Marketo, position the firm as a digital marketing leader. Given results and guidance, we are raising our fair value estimate to $610 per share, from $569. Given the stock’s run year to date, we see shares as fairly valued.

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Company Profile

Business Description

Adobe provides content creation, document management, and digital marketing and advertising software and services to creative professionals and marketers for creating, managing, delivering, measuring, optimizing and engaging with compelling content multiple operating systems, devices and media. The company operates with three segments: digital media content creation, digital experience for marketing solutions, and publishing for legacy products (less than 5% of revenue).

345 Park Avenue
San Jose, CA, 95110-2704
T +1 408 536-6000
Sector Technology
Industry Software - Infrastructure
Most Recent Earnings Aug 31, 2021
Fiscal Year End Nov 27, 2021
Stock Type Aggressive Growth
Employees 22,516