ADBE - Embedded Expectations Analysis - 2019 05 14
Adobe Incorporated (ADBE:USA) currently trades above recent averages relative toUAFRS-based (Uniform) Earnings, with a 39.3x Uniform P/E, implying bullish expectations for the firm. However, management has concerns about their ability to sustain Creative Cloud and Experience Cloud sales growth, the potential of their partnerships, and the quality of their cloud software.
Specifically, management may lack confidence in their ability to mitigate FX headwinds, and sustain Creative Cloud revenue growth, Experience Cloud customer wins, and Adobe Reader and Adobe Scan downloads. In addition, they may be concerned about the progress of their Magento and Marketo integrations, the potential of new partnerships, and their core cloud infrastructure investment roadmap. Also, they may be exaggerating retention rates of their first-mile initiative, the business transformation capabilities of their software, and their ability to standardize collaboration across an organization. Moreover, they may be concerned about their PGA Tour marketing campaign and may be exaggerating Adobe Experience Cloud's position as the only end-to-end solution for B2C and B2B customers.
Adobe is a software company. The company provides a line of products and services used for creating, managing, delivering, measuring, optimizing, engaging and transacting with content across personal computers, devices and media. The company's segments are: Digital Media, which provides products, services and solutions that enable individuals, teams and enterprises to create, publish and promote their content; Digital Experience, which provides a platform and set of applications and services through Adobe Experience Cloud; and Publishing, which contains products and services that address market opportunities including eLearning solutions, web conferencing, web application development and printing.
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