AdobeADBE
Inc. scheduled to report earnings after Thursday’s close. The stock hit a record high of $699.54/share in 2021 and, as of this writing, it is currently trading near $581. The stock is prone to big moves after reporting earnings and can easily gap up if the numbers are strong. Conversely, if the numbers disappoint, the stock can easily gap down. To help you prepare, here is what the Street is expecting:
Earnings Preview
The company is expected to report a gain of $4.38/share on $5.14 billion in revenue. Meanwhile, the so-called Whisper number is a gain of $4.45/share. The Whisper number is the Street’s unofficial view on earnings.
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A Closer Look At The Fundamentals
The company has managed to grow its earnings nicely over the last few years. In 2017, the company earned $4.31, and in 2023 the company earned $16.07, which is a large jump. Additionally, the company is expected to earn $13.92 in 2024 and in 2025, earnings are expected to grow to $15.81. The company sports a price to earnings (P/E) ratio of 36 which is 1.6 x the S&P 500.
A Closer Look At The Technicals
Technically, the stock is 9% below its 52-week high and currently bouncing off its 200 day moving average line. The stock still has a long way to go before it can hit a new all time high above $699.54. That could happen if the company manages to grow its earnings going forward. The bulls want to see the stock gap up and rally after reporting earnings and the bears want to see it gap down and fall. It’s currently trading near its simple 50 day moving average.
Company Profile
Adobe Inc., together with its subsidiaries, operates as a diversified software company worldwide. It operates through three segments: Digital Media, Digital Experience, and Publishing and Advertising. The Digital Media segment offers products, services, and solutions that enable individuals, teams, and enterprises to create, publish, and promote content; and Document Cloud, a unified cloud-based document services platform. Its flagship product is Creative Cloud, a subscription service that allows members to access its creative products. This segment serves content creators, students, workers, marketers, educators, enthusiasts, and communicators. The Digital Experience segment provides an integrated platform and set of applications and services that enable brands and businesses to create, manage, execute, measure, monetize, and optimize customer experiences from analytics to commerce. This segment serves marketers, advertisers, agencies, publishers, merchandisers, merchants, web analysts, data scientists, developers, and executives across the C-suite. The Publishing and Advertising segment offers products and services, such as e-learning solutions, technical document publishing, web conferencing, document and forms platform, web application development, and high-end printing, as well as Advertising Cloud offerings. It also provides consulting, technical support, and learning services. The company offers its products and services directly to enterprise customers through its sales force and local field offices, as well as to end users through app stores and through its website at adobe.com. It also distributes products and services through distributors, value-added resellers, systems integrators, software vendors and developers, retailers, and original equipment manufacturers. The company was formerly known as Adobe Systems Incorporated and changed its name to Adobe Inc. in October 2018. Adobe Inc. was founded in 1982 and is headquartered in San Jose, California.
Pay Attention To How The Stock Reacts To The News
From where I sit, the most important trait I look for during earnings season is how the market and a specific company reacts to the news. Remember, always keep your losses small and never argue with the tape.
Disclosure: The stock has been featured on FindLeadingStocks.com
