Last week, Adobe released its fourth quarter results for fiscal year 2024 which beat market expectations. However, despite the earnings beat, share price plunged in what has been a disappointing year for Adobe shareholders.
Keep reading to find out more about Adobe’s fiscal Q4 results and to see what analysts are forecasting in the coming months.
| Stock: | Adobe Systems Inc |
| Symbol for Invest.MT5 Account: | ADBE |
| Date of Idea: | 18 December 2024 |
| Time Line: | 6 – 12 months |
| Entry Level: | $490.00 |
| Target Level: | $604.00 |
| Position Size for Invest.MT5 Account: | Max 5% |
| Risk: | High |
- The Invest.MT5 account allows you to buy real stocks and shares from some of the largest stock exchanges in the world.
All trading is high risk, and you can lose more than you risk on a trade. Never invest more than you can afford to lose. Start small to understand your own risk tolerance levels or practice on a demo account first to build your knowledge before investing.
Adobe Fiscal Q4 2024 Performance
Here are some of the key highlights from Adobe’s fiscal fourth quarter earnings report:
- Revenue of $5.61 billion vs $5.54 billion expected. An increase of 11.1% year on year.
- Adjusted earnings per share of $4.81 vs $4.67 expected. An increase of 12.6% year on year.
- Operating income of $1.96 billion, an increase of 12%.
Adobe’s quarterly results beat expectations on the top and bottom lines, generating record revenue for the full year in the process.
However, there was one key metric which fell short of analyst expectations – its guidance for fiscal year 2025. Adobe announced that it expects revenue within a range of $23.30 billion and $23.55 billion. This was below the average analyst forecast of $23.78 billion.
As with many tech companies, Adobe has been focused on incorporating AI into its customer offerings. Indeed, its AI technology, Firefly, has now been added to several of its flagship products which, according to Adobe, has helped drive customer adoption and usage.
The tech company said that Firefly-powered generations across its tools had surpassed 16 billion. Its video generation tool, which is currently in beta, is expected to become more widely available early next year.
So far, Adobe has been concentrating more on getting customers to use its AI tools rather than trying to make money out of them. But they insist that improved monetisation is coming soon, through a new, higher-priced, Firefly offering.
Nevertheless, this approach appears to be testing shareholder patience. Many investors are eager to see quicker returns from the company’s considerable investment in AI.
Consequently, share price took a hit after results were announced, with several analysts trimming price targets on the stock. This latest drop looks set to cap what’s been a disappointing year for Adobe shareholders. Whilst a tech-led rally has seen the S&P 500 surge 27% year to date, Adobe has sunk more than 20%.
But some remain confident that Adobe will be able to successfully deliver meaningful growth from its AI products in the future. Let’s take a closer look at what the analysts are forecasting for the stock over the next year.
Adobe Stock Forecast – What do the Analysts Say?
According to 26 analysts polled by TipRanks for an Adobe stock forecast in the past 3 months, there are currently 20 buy, 5 hold and 1 sell ratings on the stock. The highest price target amongst these analysts is currently $703.00, whilst the lowest is $450.00.
The average price target for an Adobe stock forecast is $604.33.
An Example Trading Idea for the Adobe Stock Price
An example trading idea for the Adobe share price could be as follows:
- Buy the stock on a break above $490.00 to allow for volatility.
- Target just below the average analyst price target at $604.00.
- Keep your risk small at a maximum of 5% of your total account.
- Time Line = 6 – 12 months
- If you buy 10 Adobe shares:
- If target is reached = $1,140.00 potential profit [($604.00 – $490.00) * 10 shares].
Remember that markets go up and down. It is unlikely the share price will move up in a straight line. In fact, it may even go much further down before it rises, if it rises at all. Be sure to exercise good risk management and always know how much you could potentially lose on a trade and all the risks involved, as well as the costs.
With the Admirals Invest.MT5 account you can buy and sell US stocks with commissions from $0.02 per share and a minimum transaction fee of $1. This means that buying 10 Adobe shares would result in a commission of just $1 overall.
How to Buy Adobe Stock in 4 Steps
With Admirals, you can buy shares in Adobe and more than 4,500 other companies from around the world. Follow these steps to get started:
- Open an account with Admirals and log in to the dashboard.
- Click Trade or Invest next to one of your live or demo accounts to open the web platform.
- Search for Adobe stock in the search window at the top.
- Create a new order and input your entry, stop-loss and take profit levels.
Click on the banner below to trade Adobe stock today ▼▼▼
Do You See the Adobe Stock Price Moving Differently?
Remember that all analytics and trading ideas are based on the personal view and experience of the author.
If you believe there is a higher chance the Adobe share price will move lower, then you could choose to trade short using CFDs, which Admirals also provides access to through its Trade.MT5 and Trade.MT4 accounts.
With CFDs, you can trade long and short to speculate on both rising and falling stock prices.
INFORMATION ABOUT ANALYTICAL MATERIALS:
The given data provides additional information regarding all analysis, estimates, prognosis, forecasts, market reviews, weekly outlooks or other similar assessments or information (hereinafter “Analysis”) published on the websites of Admirals investment firms operating under the Admirals trademark (hereinafter “Admirals”) Before making any investment decisions please pay close attention to the following:
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- The Analysis is prepared by an independent analyst Roberto Rivero, Freelance Contributor (hereinafter “Author”) based on personal estimations.
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