ADOBE INC (ADBE) Stock Fundamental Analysis
USA - NASDAQ:ADBE - US00724F1012 - Common Stock
331.11 USD
-2.49 (-0.75%)
331.17 USD
+0.06 (+0.02%)
Overall ADBE gets a fundamental rating of 7 out of 10. We evaluated ADBE against 281 industry peers in the Software industry. ADBE has outstanding health and profitabily ratings, belonging to the best of the industry. This is a solid base for any company. ADBE may be a bit undervalued, certainly considering the very reasonable score on growth These ratings would make ADBE suitable for value and quality investing!
1. Profitability
1.1 Basic Checks
In the past year ADBE was profitable.
ADBE had a positive operating cash flow in the past year.
Each year in the past 5 years ADBE has been profitable.
Each year in the past 5 years ADBE had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 24.19%, ADBE belongs to the top of the industry, outperforming 97.15% of the companies in the same industry.
With an excellent Return On Equity value of 59.11%, ADBE belongs to the best of the industry, outperforming 97.51% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 34.45%, ADBE belongs to the top of the industry, outperforming 97.51% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for ADBE is significantly above the industry average of 11.92%.
The 3 year average ROIC (27.26%) for ADBE is below the current ROIC(34.45%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 24.19% | ||
| ROE | 59.11% | ||
| ROIC | 34.46% |
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
ADBE has a better Profit Margin (30.01%) than 91.10% of its industry peers.
In the last couple of years the Profit Margin of ADBE has remained more or less at the same level.
The Operating Margin of ADBE (36.25%) is better than 94.31% of its industry peers.
In the last couple of years the Operating Margin of ADBE has grown nicely.
The Gross Margin of ADBE (89.14%) is better than 95.73% of its industry peers.
In the last couple of years the Gross Margin of ADBE has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 36.25% | ||
| PM (TTM) | 30.01% | ||
| GM | 89.14% |
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
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), ADBE is creating value.
ADBE has less shares outstanding than it did 1 year ago.
The number of shares outstanding for ADBE has been reduced compared to 5 years ago.
The debt/assets ratio for ADBE is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 8.83 indicates that ADBE is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 8.83, ADBE belongs to the top of the industry, outperforming 85.77% of the companies in the same industry.
The Debt to FCF ratio of ADBE is 0.65, which is an excellent value as it means it would take ADBE, only 0.65 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of ADBE (0.65) is better than 79.00% of its industry peers.
A Debt/Equity ratio of 0.53 indicates that ADBE is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.53, ADBE is doing worse than 65.12% of the companies in the same industry.
Even though the debt/equity ratio score it not favorable for ADBE, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.53 | ||
| Debt/FCF | 0.65 | ||
| Altman-Z | 8.83 |
ROIC/WACC3.18
WACC10.85%
2.3 Liquidity
A Current Ratio of 1.02 indicates that ADBE should not have too much problems paying its short term obligations.
ADBE has a worse Current ratio (1.02) than 72.24% of its industry peers.
A Quick Ratio of 1.02 indicates that ADBE should not have too much problems paying its short term obligations.
The Quick ratio of ADBE (1.02) is worse than 70.82% of its industry peers.
ADBE does not score too well on the current and quick ratio evaluation. However, as it has 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 | 1.02 | ||
| Quick Ratio | 1.02 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 13.31% over the past year.
ADBE shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 18.69% yearly.
Looking at the last year, ADBE shows a quite strong growth in Revenue. The Revenue has grown by 10.67% in the last year.
Measured over the past years, ADBE shows a quite strong growth in Revenue. The Revenue has been growing by 14.00% on average per year.
EPS 1Y (TTM)13.31%
EPS 3Y13.86%
EPS 5Y18.69%
EPS Q2Q%14.19%
Revenue 1Y (TTM)10.67%
Revenue growth 3Y10.86%
Revenue growth 5Y14%
Sales Q2Q%10.72%
3.2 Future
Based on estimates for the next years, ADBE will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.20% on average per year.
ADBE is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 8.95% yearly.
EPS Next Y15.35%
EPS Next 2Y13.74%
EPS Next 3Y13.35%
EPS Next 5Y11.2%
Revenue Next Year10.46%
Revenue Next 2Y9.86%
Revenue Next 3Y9.64%
Revenue Next 5Y8.95%
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
The Price/Earnings ratio is 16.34, which indicates a correct valuation of ADBE.
Based on the Price/Earnings ratio, ADBE is valued a bit cheaper than 79.36% of the companies in the same industry.
ADBE is valuated rather cheaply when we compare the Price/Earnings ratio to 25.89, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 13.89, the valuation of ADBE can be described as correct.
81.49% of the companies in the same industry are more expensive than ADBE, based on the Price/Forward Earnings ratio.
ADBE is valuated cheaply when we compare the Price/Forward Earnings ratio to 34.59, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.34 | ||
| Fwd PE | 13.89 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of ADBE indicates a rather cheap valuation: ADBE is cheaper than 83.63% of the companies listed in the same industry.
ADBE's Price/Free Cash Flow ratio is rather cheap when compared to the industry. ADBE is cheaper than 86.48% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 14.44 | ||
| EV/EBITDA | 15.01 |
4.3 Compensation for Growth
ADBE's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of ADBE may justify a higher PE ratio.
ADBE's earnings are expected to grow with 13.35% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.06
PEG (5Y)0.87
EPS Next 2Y13.74%
EPS Next 3Y13.35%
5. Dividend
5.1 Amount
No dividends for ADBE!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
331.11
-2.49 (-0.75%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners86.03%
Inst Owner Change-1.3%
Ins Owners0.16%
Ins Owner Change1.16%
Market Cap138.60B
Revenue(TTM)23.18B
Net Income(TTM)6.96B
Analysts78.72
Price Target473.01 (42.86%)
Short Float %2.76%
Short Ratio2.61
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.24%
Min EPS beat(2)-0.06%
Max EPS beat(2)0.55%
EPS beat(4)3
Avg EPS beat(4)0.45%
Min EPS beat(4)-0.06%
Max EPS beat(4)1.15%
EPS beat(8)7
Avg EPS beat(8)0.5%
EPS beat(12)11
Avg EPS beat(12)0.67%
EPS beat(16)11
Avg EPS beat(16)0.26%
Revenue beat(2)0
Avg Revenue beat(2)-0.58%
Min Revenue beat(2)-0.6%
Max Revenue beat(2)-0.56%
Revenue beat(4)0
Avg Revenue beat(4)-0.73%
Min Revenue beat(4)-0.99%
Max Revenue beat(4)-0.56%
Revenue beat(8)0
Avg Revenue beat(8)-1.08%
Revenue beat(12)0
Avg Revenue beat(12)-1.21%
Revenue beat(16)0
Avg Revenue beat(16)-1.27%
PT rev (1m)0%
PT rev (3m)-6.34%
EPS NQ rev (1m)0%
EPS NQ rev (3m)1.06%
EPS NY rev (1m)-0.04%
EPS NY rev (3m)0.88%
Revenue NQ rev (1m)-0.02%
Revenue NQ rev (3m)0.45%
Revenue NY rev (1m)-0.01%
Revenue NY rev (3m)0.48%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.34 | ||
| Fwd PE | 13.89 | ||
| P/S | 5.98 | ||
| P/FCF | 14.44 | ||
| P/OCF | 14.15 | ||
| P/B | 11.78 | ||
| P/tB | N/A | ||
| EV/EBITDA | 15.01 |
EPS(TTM)20.26
EY6.12%
EPS(NY)23.83
Fwd EY7.2%
FCF(TTM)22.93
FCFY6.93%
OCF(TTM)23.39
OCFY7.06%
SpS55.38
BVpS28.12
TBVpS-3.93
PEG (NY)1.06
PEG (5Y)0.87
Graham Number113.21
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 24.19% | ||
| ROE | 59.11% | ||
| ROCE | 43.05% | ||
| ROIC | 34.46% | ||
| ROICexc | 49.53% | ||
| ROICexgc | 4255.63% | ||
| OM | 36.25% | ||
| PM (TTM) | 30.01% | ||
| GM | 89.14% | ||
| FCFM | 41.41% |
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%
ROICexgc growth 3YN/A
ROICexgc 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 Turnover0.81
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.53 | ||
| Debt/FCF | 0.65 | ||
| Debt/EBITDA | 0.67 | ||
| Cap/Depr | 22.65% | ||
| Cap/Sales | 0.83% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 105.81% | ||
| Profit Quality | 137.98% | ||
| Current Ratio | 1.02 | ||
| Quick Ratio | 1.02 | ||
| Altman-Z | 8.83 |
F-Score7
WACC10.85%
ROIC/WACC3.18
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)13.31%
EPS 3Y13.86%
EPS 5Y18.69%
EPS Q2Q%14.19%
EPS Next Y15.35%
EPS Next 2Y13.74%
EPS Next 3Y13.35%
EPS Next 5Y11.2%
Revenue 1Y (TTM)10.67%
Revenue growth 3Y10.86%
Revenue growth 5Y14%
Sales Q2Q%10.72%
Revenue Next Year10.46%
Revenue Next 2Y9.86%
Revenue Next 3Y9.64%
Revenue Next 5Y8.95%
EBIT growth 1Y11.62%
EBIT growth 3Y10.09%
EBIT growth 5Y17.62%
EBIT Next Year17.42%
EBIT Next 3Y11.33%
EBIT Next 5Y10.2%
FCF growth 1Y25.87%
FCF growth 3Y4.59%
FCF growth 5Y14.35%
OCF growth 1Y21.94%
OCF growth 3Y3.67%
OCF growth 5Y12.75%
ADOBE INC / ADBE FAQ
What is the ChartMill fundamental rating of ADOBE INC (ADBE) stock?
ChartMill assigns a fundamental rating of 7 / 10 to ADBE.
Can you provide the valuation status for ADOBE INC?
ChartMill assigns a valuation rating of 7 / 10 to ADOBE INC (ADBE). This can be considered as Undervalued.
What is the profitability of ADBE stock?
ADOBE INC (ADBE) has a profitability rating of 9 / 10.
What are the PE and PB ratios of ADOBE INC (ADBE) stock?
The Price/Earnings (PE) ratio for ADOBE INC (ADBE) is 16.34 and the Price/Book (PB) ratio is 11.78.
What is the financial health of ADOBE INC (ADBE) stock?
The financial health rating of ADOBE INC (ADBE) is 7 / 10.