Adobe Systems Inc. reported third quarter earnings that surpassed analysts’ expectations.
The software company's adjusted earnings came in at $2.57 per share, compared to the $2.41 per share expected by analysts polled by Thomson Reuters.
Adobe’s quarterly revenue climbed +14.1% year-over-year to $3.23 billion.
For the quarter ahead, the company is expecting earnings of $2.64 per share on revenue of $3.35 billion.
Tickeron's AI-powered scorecard rates ADBE a 'Buy'.
According to Tickeron.
Aroon Indicator for ADBE shows an upward move is likely
ADBE's Aroon Indicator triggered a bullish signal on September 14, 2020. Tickeron's A.I.dvisor detected that the AroonUp green line is above 70 while the AroonDown red line is below 30. When the up indicator moves above 70 and the down indicator remains below 30, it is a sign that the stock could be setting up for a bullish move. Traders may want to buy the stock or look to buy calls options. A.I.dvisor looked at 448 similar instances where the Aroon Indicator showed a similar pattern. In 319 of the 448 cases, the stock moved higher in the days that followed. This puts the odds of a move higher at 71%.
Current price $484.99 is above $449.57 the highest support line found by A.I. Throughout the month of 08/13/20 - 09/15/20, the price experienced a +11% Uptrend. During the week of 09/08/20 - 09/15/20, the stock enjoyed a +8% Uptrend growth.
Technical Analysis (Indicators)
Bullish Trend Analysis
The Stochastic Indicator suggests the stock price trend may be in a reversal from a downward trend to an upward trend. 22 of 39 cases where ADBE's Stochastic Oscillator exited the oversold zone resulted in an increase in price. Tickeron's analysis proposes that the odds of a continued upward trend are 81%.
Following a +5.58% 3-day Advance, the price is estimated to grow further. Considering data from situations where ADBE advanced for three days, in 254 of 361 cases, the price rose further within the following month. The odds of a continued upward trend are 70%.
Bearish Trend Analysis
The 10-day RSI Indicator for ADBE moved out of overbought territory on September 03, 2020. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 65 similar instances where the indicator moved out of overbought territory. In 30 of the 65 cases, the stock moved lower in the following days. This puts the odds of a move lower at 46%.
The Momentum Indicator moved below the 0 level on September 08, 2020. You may want to consider selling the stock, shorting the stock, or exploring put options on ADBE as a result. In 38 of 88 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are 43%.
The Moving Average Convergence Divergence Histogram (MACD) for ADBE turned negative on September 08, 2020. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 50 similar instances when the indicator turned negative. In 25 of the 50 cases the stock turned lower in the days that followed. This puts the odds of success at 50%.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where Apple declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 42%.
ADBE broke above its upper Bollinger Band on August 26, 2020. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
Fundamental Analysis (Ratings)
Tickeron has a negative outlook on this ticker and predicts a further decline by more than 4.00% within the next month with a likelihood of 62%. During the last month, the daily ratio of advancing to declining volumes was 1.12 to 1.
The Tickeron Profit vs. Risk Rating rating for this company is 2 (best 1 - 100 worst), indicating low risk on high returns. The average Profit vs. Risk Rating rating for the industry is 81, placing this stock better than average.
The Tickeron Price Growth Rating for this company is 5 (best 1 - 100 worst), indicating outstanding price growth. ADBE’s price grows at a higher rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron SMR rating for this company is 12 (best 1 - 100 worst), indicating very strong sales and a profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron PE Growth Rating for this company is 35 (best 1 - 100 worst), pointing to consistent earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Valuation Rating of 84 (best 1 - 100 worst) indicates that the company is slightly overvalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (21.95) is normal, around the industry mean (12.87). P/E Ratio (65.63) is within average values for comparable stocks, (296.17). Projected Growth (PEG Ratio) (1.24) is also within normal values, averaging (7.02). Dividend Yield (0.00) settles around the average of (0.31) among similar stocks. P/S Ratio (15.61) is also within normal values, averaging (16.14).