Adobe Systems (ADBE - Free Report) closed the most recent trading day at $471.35, moving -1.03% from the previous trading session. This change lagged the S&P 500's daily gain of 0.05%. Meanwhile, the Dow gained 0.48%, and the Nasdaq, a tech-heavy index, lost 0.61%.
Prior to today's trading, shares of the software maker had gained 5.83% over the past month. This has outpaced the Computer and Technology sector's gain of 0.29% and the S&P 500's loss of 0.52% in that time.
ADBE will be looking to display strength as it nears its next earnings release, which is expected to be September 15, 2020. In that report, analysts expect ADBE to post earnings of $2.40 per share. This would mark year-over-year growth of 17.07%. Our most recent consensus estimate is calling for quarterly revenue of $3.15 billion, up 11.24% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $9.77 per share and revenue of $12.71 billion. These totals would mark changes of +24.14% and +13.81%, respectively, from last year.
Investors should also note any recent changes to analyst estimates for ADBE. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection remained stagnant. ADBE is holding a Zacks Rank of #3 (Hold) right now.
In terms of valuation, ADBE is currently trading at a Forward P/E ratio of 48.76. Its industry sports an average Forward P/E of 33.18, so we one might conclude that ADBE is trading at a premium comparatively.
Also, we should mention that ADBE has a PEG ratio of 3.05. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Computer - Software was holding an average PEG ratio of 2.56 at yesterday's closing price.
The Computer - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 67, putting it in the top 27% of all 250+ industries.
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.