![]() Of the 36 analysts who cover Adobe, half have buy grade ratings and the other half has hold ratings, along with an average price target of $390, up from a previous $385.03, as nine analysts raised their price targets and one lowered theirs. "We expect the stock to trade up following better than expected results, but suspect shares could be rangebound post the Q given continued Figma overhang, and the potential for growth to further moderate given diminishing price tailwinds and macro uncertainty throughout FY23," Radke said. Jefferies analyst Brent Thill, who has a buy rating and a $440 price target, said Adobe's fundamentals are holding up amid macro concerns but he's concerned a 2023 recession could lead to more layoffs, resulting in fewer users and subscriptions and fewer deals for its digital experience segment.Ĭoncerning Figma, Thill said that uncertainty over the deal closing "remains an overhang."Ĭiti Research Tyler Radke, who has a neutral rating and a $334 price target, said that with peak price increases in the first quarter, "it's difficult to evaluate the sustainability of the Q2 performance." "Next quarter has two months of pricing tailwinds, then things annualize, meaning we could see Creative growth fade a bit further unless something in the macro changes or there is another price action." "Now user growth is the bigger piece of growth, and the company does not give much on the pricing benefits specifically, but they are there," Auty said. ARR is a metric often used by software-as-a-service, or SaaS, companies to show how much revenue the company can expect based on subscriptions. "But we believe the growth outlook is much better including Figma at this point than without it."Īuty, however, said pricing tailwinds helped boost annualized recurring revenue for the company's digital media segment, and he expects those tailwinds to fade next quarter.ĭigital media ARR for the quarter was $410 million, while analysts had forecast $376.1 million, and the company forecast ARR of about $420 million, while the Street was looking for $388.7 million at the time, according to FactSet. "The management statement, we believe, points to the idea that Adobe will be fine if the deal gets blocked or goes through," Auty said. MoffetNathanson Sterling Auty, who has a market perform rating and a $360 price target, zeroed in on one comment management made on the conference call with analysts that the company had "from the outset" been "well-prepared for all potential scenarios, while realistic about the regulatory environment." Read: Adobe's stock drops as potential block on Figma deal raises concerns about growth At the time, the deal received little love from Wall Street, but later analysts warmed up to the idea as a catalyst for growth as the Justice Department reportedly prepares a lawsuit to block the deal. Late Wednesday, Adobe's results and outlook topped Wall Street expectations on strong growth in the company's digital media subscriptions, while projecting confidence about closing its acquisition of design platform Figma.īack in September, Adobe announced its deal to acquire Figma. shares rose Thursday as analysts praised a clean quarter and an outlook hike amid macro concerns, but noted that the boost will fade over the year as the software company prepares to fight for its $20 billion acquisition of privately held Figma.Īdobe (ADBE) shares rose nearly 6% Wednesday to an intraday high of $352.80, as the iShares Expanded Tech-Software Sector ETF (IGV) rose 2.5%, the S&P 500 index gained 1.2%, and the tech-heavy Nasdaq Composite Index rose 1.8% in recent activity. Adobe will be 'fine if the deal gets blocked or goes through' but growth will be better with it, analyst saysĪdobe Inc.
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