Stockchase DiscoverAdobe SystemsADBEBUYMar 21, 2023

Still runway, price target of $672. So many developments going on in AI. Generative AI can produce images from text. Transform a 2D image to high-quality 3D in 5 seconds. Buy in thirds here around $614, $580, and $550. No dividend.

We thought the Figma deal would be good for the company, but investors initially did not like it. At $20B, it 'sounded' big, but represented only about 10% of ADBE's market cap at the time of the first announcement. ADBE market cap has risen about another $90B since the offer, so Figma's significance has declined even more. Still, it is disappointing, and ADBE has to pay Figma a $1B cash break fee, but life will go on. ADBE noted this week it will use the cash earmarked for the deal to go to buybacks and more AI development. We would not let the failed deal change our positive opinion of the company's future. 
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Valuation high, but management team very good. Would recommend buying on weakness. Has excellent product range and franchise value. Tech stack strong. 

Yes. Down today on shy 2024 estimates. Companies are being cautious. One of the leaders in AI applications. Tons of opportunity. Don't buy this afternoon, but if you see the stock down tomorrow morning, he wouldn't get in your way.

Today it reported a clean top and bottom line beat that beat numbers in nearly every segment, but their 2024 full-year forecast came in light. Also, shares were hot leading up to the report, up 85% this year.

One of his favourite companies which has consistently delivered returns. Benefits big from the AI trend. However, shares tend to be volatile right after earnings. They report Wednesday. Last year, Adobe bought Figma, a design company. He disagrees with some, feeling that Figma was worth the price, because Figma's tools are so beloved by users. Regulators are challenging the deal over anti-trust concerns. Could Adobe walk away from the deal?

An analyst meeting next Tuesday. Current weakness is tempting to buy. Is driven by gen AI popularity and e-commerce in the markets. Their AI Firefly product is unmatched by anyone.

Great company. With higher rates, cost of capital to sustain growth will be challenged. You can see the pullback. Don't buy here, but put on your radar. If we get rates higher for longer, names will reprice quite meaningfully. Solid.

A high-quality SAAS company. Also, likes their business in AI. He has sold a lot of tech to raise his cash level to 10%. However, he has added to a few names including Adobe.

Excelled. Still some runway, his 12-month price target is $605. Latest results beat on top and bottom. Came out with Firefly package for AI. Things are humming perfectly. Buy in thirds here around $530, 500, and 475.

An original cloud king that went profitable a long time ago and is now into AI. Up 58% this year. But after reporting last Thursday, it slid 4% though has partially recovered. Some feel that Adobe's quarter dropped the ball, but he disagrees. They report a modest revenue beat with sales up 10% YOY, with the digital media business better than expected and non-GAAP EPS also beating. There was no problem in the guidance with the earnings outlook robust. Note: a week before the report Adobe announced price increases for subscribers starting Nov. 1 as it develops its Firefly AI. So, share rallied hot before the report. Shares ran up and typically people sell on the news and take profits. Also, Adobe moved its full-year forecast to next December, which spooked some weak-kneed investors. He wanted to hear an update about their Figma buy, but they couldn't yet. Buy this pullback.

Shares are coming back after an acquisition the street didn't like. Not an Apple or Microsoft, but a great tech company. Share have recovered to levels he bought at. 

They report later this week. Web traffic has been strong. Firefly should be positive. Beware that high hopes are already baked into shares.

She wants to hear about the software cycle: is demand stabilizing and the sales cycle elongating. Adobe will talk about AI.

Will talk alot about AI next week. If you want AI exposure outside Nvidia this is the real deal with a good runway ahead, despite rallying far this year already.