In the latest close session, Adobe Systems (ADBE) was down 2.16% at $240.83. This change lagged the S&P 500's 0.16% loss on the day. On the other hand, the Dow registered a gain of 0.11%, and the technology-centric Nasdaq decreased by 0.71%.
Heading into today, shares of the software maker had gained 2.52% over the past month, lagging the Computer and Technology sector's gain of 17.98% and the S&P 500's gain of 8.81%.
The investment community will be closely monitoring the performance of Adobe Systems in its forthcoming earnings report. The company is forecasted to report an EPS of $5.83, showcasing a 15.22% upward movement from the corresponding quarter of the prior year. Alongside, our most recent consensus estimate is anticipating revenue of $6.46 billion, indicating a 9.94% upward movement from the same quarter last year.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $23.51 per share and revenue of $26.06 billion. These totals would mark changes of +12.27% and +9.64%, respectively, from last year.
Investors should also take note of any recent adjustments to analyst estimates for Adobe Systems. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Based on our research, we believe these estimate revisions are directly related to near-term stock moves. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable rating system.
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. Over the last 30 days, the Zacks Consensus EPS estimate has remained unchanged. Adobe Systems currently has a Zacks Rank of #3 (Hold).
In the context of valuation, Adobe Systems is at present trading with a Forward P/E ratio of 10.47. This signifies a discount in comparison to the average Forward P/E of 16.8 for its industry.
Also, we should mention that ADBE has a PEG ratio of 0.78. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Computer - Software was holding an average PEG ratio of 1.51 at yesterday's closing price.
The Computer - Software industry is part of the Computer and Technology sector. This industry, currently bearing a Zacks Industry Rank of 154, finds itself in the bottom 37% echelons of all 250+ industries.
The Zacks Industry Rank is ordered 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.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.
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Adobe Inc. (ADBE): Free Stock Analysis Report
This article originally published on Zacks Investment Research (zacks.com).