ADOBE INC (ADB.DE) Stock Fundamental Analysis
FRA:ADB - Deutsche Boerse Ag - US00724F1012 - Common Stock - Currency: EUR
We assign a fundamental rating of 7 out of 10 to ADB. ADB was compared to 98 industry peers in the Software industry. ADB scores excellent points on both the profitability and health parts. This is a solid base for a good stock. ADB has a correct valuation and a medium growth rate. These ratings could make ADB a good candidate for quality investing.
1. Profitability
1.1 Basic Checks
ADB had positive earnings in the past year.
In the past year ADB had a positive cash flow from operations.
Each year in the past 5 years ADB has been profitable.
Each year in the past 5 years ADB had a positive operating cash flow.
1.2 Ratios
With an excellent Return On Assets value of 18.39%, ADB belongs to the best of the industry, outperforming 98.85% of the companies in the same industry.
ADB's Return On Equity of 39.42% is amongst the best of the industry. ADB outperforms 94.25% of its industry peers.
ADB's Return On Invested Capital of 31.43% is amongst the best of the industry. ADB outperforms 98.85% of its industry peers.
ADB had an Average Return On Invested Capital over the past 3 years of 27.26%. This is significantly above the industry average of 11.66%.
The last Return On Invested Capital (31.43%) for ADB is above the 3 year average (27.26%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 18.39% | ||
| ROE | 39.42% | ||
| ROIC | 31.43% |
ROA(3y)18.04%
ROA(5y)18.7%
ROE(3y)35.38%
ROE(5y)35.67%
ROIC(3y)27.26%
ROIC(5y)24.7%
1.3 Margins
ADB's Profit Margin of 25.85% is amongst the best of the industry. ADB outperforms 91.95% of its industry peers.
In the last couple of years the Profit Margin of ADB has remained more or less at the same level.
ADB has a better Operating Margin (36.00%) than 96.55% of its industry peers.
ADB's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 89.04%, ADB belongs to the top of the industry, outperforming 83.91% of the companies in the same industry.
In the last couple of years the Gross Margin of ADB has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 36% | ||
| PM (TTM) | 25.85% | ||
| GM | 89.04% |
OM growth 3Y-0.69%
OM growth 5Y3.18%
PM growth 3Y-5.41%
PM growth 5Y-0.43%
GM growth 3Y0.32%
GM growth 5Y0.93%
2. Health
2.1 Basic Checks
ADB has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
The number of shares outstanding for ADB has been reduced compared to 1 year ago.
ADB has less shares outstanding than it did 5 years ago.
The debt/assets ratio for ADB is higher compared to a year ago.
2.2 Solvency
ADB has an Altman-Z score of 10.58. This indicates that ADB is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of ADB (10.58) is better than 85.06% of its industry peers.
ADB has a debt to FCF ratio of 0.71. This is a very positive value and a sign of high solvency as it would only need 0.71 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 0.71, ADB is doing good in the industry, outperforming 77.01% of the companies in the same industry.
ADB has a Debt/Equity ratio of 0.29. This is a healthy value indicating a solid balance between debt and equity.
ADB has a Debt to Equity ratio (0.29) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.29 | ||
| Debt/FCF | 0.71 | ||
| Altman-Z | 10.58 |
ROIC/WACC2.9
WACC10.85%
2.3 Liquidity
ADB has a Current Ratio of 1.07. This is a normal value and indicates that ADB is financially healthy and should not expect problems in meeting its short term obligations.
ADB's Current ratio of 1.07 is on the low side compared to the rest of the industry. ADB is outperformed by 71.26% of its industry peers.
A Quick Ratio of 1.07 indicates that ADB should not have too much problems paying its short term obligations.
ADB's Quick ratio of 1.07 is on the low side compared to the rest of the industry. ADB is outperformed by 66.67% of its industry peers.
The current and quick ratio evaluation for ADB is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.07 | ||
| Quick Ratio | 1.07 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 14.62% over the past year.
The Earnings Per Share has been growing by 18.69% on average over the past years. This is quite good.
Looking at the last year, ADB shows a quite strong growth in Revenue. The Revenue has grown by 10.80% in the last year.
The Revenue has been growing by 14.00% on average over the past years. This is quite good.
EPS 1Y (TTM)14.62%
EPS 3Y13.86%
EPS 5Y18.69%
EPS Q2Q%12.65%
Revenue 1Y (TTM)10.8%
Revenue growth 3Y10.86%
Revenue growth 5Y14%
Sales Q2Q%11.05%
3.2 Future
The Earnings Per Share is expected to grow by 11.62% on average over the next years. This is quite good.
The Revenue is expected to grow by 9.40% on average over the next years. This is quite good.
EPS Next Y13%
EPS Next 2Y12.99%
EPS Next 3Y12.51%
EPS Next 5Y11.62%
Revenue Next Year9.57%
Revenue Next 2Y9.85%
Revenue Next 3Y9.67%
Revenue Next 5Y9.4%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 23.65, the valuation of ADB can be described as rather expensive.
79.31% of the companies in the same industry are more expensive than ADB, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 28.47, ADB is valued at the same level.
A Price/Forward Earnings ratio of 20.93 indicates a rather expensive valuation of ADB.
Based on the Price/Forward Earnings ratio, ADB is valued a bit cheaper than the industry average as 67.82% of the companies are valued more expensively.
ADB is valuated cheaply when we compare the Price/Forward Earnings ratio to 92.74, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.65 | ||
| Fwd PE | 20.93 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ADB is on the same level as its industry peers.
ADB's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. ADB is cheaper than 73.56% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 24.36 | ||
| EV/EBITDA | 22.27 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The excellent profitability rating of ADB may justify a higher PE ratio.
ADB's earnings are expected to grow with 12.51% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.82
PEG (5Y)1.27
EPS Next 2Y12.99%
EPS Next 3Y12.51%
5. Dividend
5.1 Amount
No dividends for ADB!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
ADOBE INC
FRA:ADB (2/5/2025, 3:57:23 PM)
421.5
-4.9 (-1.15%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners87.24%
Inst Owner ChangeN/A
Ins Owners0.15%
Ins Owner ChangeN/A
Market Cap185.54B
Analysts80.43
Price Target570.25 (35.29%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly Dividend0
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)0.91%
Min EPS beat(2)0.66%
Max EPS beat(2)1.15%
EPS beat(4)4
Avg EPS beat(4)0.54%
Min EPS beat(4)0.06%
Max EPS beat(4)1.15%
EPS beat(8)8
Avg EPS beat(8)0.82%
EPS beat(12)9
Avg EPS beat(12)0.45%
EPS beat(16)12
Avg EPS beat(16)1.31%
Revenue beat(2)0
Avg Revenue beat(2)-1.01%
Min Revenue beat(2)-1.24%
Max Revenue beat(2)-0.78%
Revenue beat(4)0
Avg Revenue beat(4)-1.22%
Min Revenue beat(4)-1.65%
Max Revenue beat(4)-0.78%
Revenue beat(8)0
Avg Revenue beat(8)-1.29%
Revenue beat(12)0
Avg Revenue beat(12)-1.4%
Revenue beat(16)2
Avg Revenue beat(16)-1.02%
PT rev (1m)-1.41%
PT rev (3m)-3.12%
EPS NQ rev (1m)0.43%
EPS NQ rev (3m)1.48%
EPS NY rev (1m)-0.15%
EPS NY rev (3m)-0.7%
Revenue NQ rev (1m)-1.23%
Revenue NQ rev (3m)-1.6%
Revenue NY rev (1m)-0.15%
Revenue NY rev (3m)-1.24%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.65 | ||
| Fwd PE | 20.93 | ||
| P/S | 8.92 | ||
| P/FCF | 24.36 | ||
| P/OCF | 23.8 | ||
| P/B | 13.6 | ||
| P/tB | 358.43 | ||
| EV/EBITDA | 22.27 |
EPS(TTM)17.82
EY4.23%
EPS(NY)20.14
Fwd EY4.78%
FCF(TTM)17.31
FCFY4.11%
OCF(TTM)17.71
OCFY4.2%
SpS47.27
BVpS31
TBVpS1.18
PEG (NY)1.82
PEG (5Y)1.27
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 18.39% | ||
| ROE | 39.42% | ||
| ROCE | 39.28% | ||
| ROIC | 31.43% | ||
| ROICexc | 52.4% | ||
| ROICexgc | N/A | ||
| OM | 36% | ||
| PM (TTM) | 25.85% | ||
| GM | 89.04% | ||
| FCFM | 36.61% |
ROA(3y)18.04%
ROA(5y)18.7%
ROE(3y)35.38%
ROE(5y)35.67%
ROIC(3y)27.26%
ROIC(5y)24.7%
ROICexc(3y)43%
ROICexc(5y)37.74%
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)34.07%
ROCE(5y)30.87%
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3Y17.87%
ROICexc growth 5Y9.83%
OM growth 3Y-0.69%
OM growth 5Y3.18%
PM growth 3Y-5.41%
PM growth 5Y-0.43%
GM growth 3Y0.32%
GM growth 5Y0.93%
F-Score7
Asset Turnover0.71
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.29 | ||
| Debt/FCF | 0.71 | ||
| Debt/EBITDA | 0.48 | ||
| Cap/Depr | 21.35% | ||
| Cap/Sales | 0.85% | ||
| Interest Coverage | 82.35 | ||
| Cash Conversion | 93.7% | ||
| Profit Quality | 141.6% | ||
| Current Ratio | 1.07 | ||
| Quick Ratio | 1.07 | ||
| Altman-Z | 10.58 |
F-Score7
WACC10.85%
ROIC/WACC2.9
Cap/Depr(3y)38.09%
Cap/Depr(5y)42.76%
Cap/Sales(3y)1.74%
Cap/Sales(5y)2.14%
Profit Quality(3y)141.67%
Profit Quality(5y)133.73%
High Growth Momentum
Growth
EPS 1Y (TTM)14.62%
EPS 3Y13.86%
EPS 5Y18.69%
EPS Q2Q%12.65%
EPS Next Y13%
EPS Next 2Y12.99%
EPS Next 3Y12.51%
EPS Next 5Y11.62%
Revenue 1Y (TTM)10.8%
Revenue growth 3Y10.86%
Revenue growth 5Y14%
Sales Q2Q%11.05%
Revenue Next Year9.57%
Revenue Next 2Y9.85%
Revenue Next 3Y9.67%
Revenue Next 5Y9.4%
EBIT growth 1Y16.41%
EBIT growth 3Y10.09%
EBIT growth 5Y17.62%
EBIT Next Year16.33%
EBIT Next 3Y11.72%
EBIT Next 5Y9.91%
FCF growth 1Y13.41%
FCF growth 3Y4.59%
FCF growth 5Y14.35%
OCF growth 1Y10.33%
OCF growth 3Y3.67%
OCF growth 5Y12.75%