Adobe Systems Trading forecasts and signals

The market the day beforeThe US stock exchanges ended the trading session on June 15 with growth. The S&P 500 gained 1.46%, returning to 3,790 points, the Nasdaq rose 2.50%, the Dow Jones rose 1.00%. The discretionary goods sector (+2.81%) and telecoms (+2.47%) became the leaders of growth. The negative dynamics was demonstrated by energy companies (-2.21%) and suppliers of raw materials (-0.03%).Company newsBoeing (BA: +9.46%) is working to stabilize the production and supply of 737 MAX aircraft. Earlier, the Chinese airline China Southern Airlines conducted a successful test flight of the 737 MAX, which signals the likelihood of resuming the use of aircraft of this brand in China due to high demand for air transportation.Nio (NIO: +7.77%) has officially introduced a new model of the ES7 electric car, which has become the most powerful serial crossover. The start of sales of the ES7 is scheduled for the end of August.Ford (F: +0.57%) is recalling 2.9 million vehicles produced in 2013-2021 to fix transmission problems. This was the third recall of the automaker's products in a week.We expectFollowing the meeting on June 14-15, the Fed for the first time since 1994 raised the discount rate immediately by 75 bps, in the range of 1.50–1.75%. By the end of this year, the FOMC plans to bring the upper limit of this range to 3.5%, despite the fact that 2.8% was predicted in March. Thus, at the July meeting, the regulator may raise the rate by 75 bps again, and in September it will be raised by 50 bps. The intensification of monetary policy tightening is expedient in conditions when inflation has already tripled the target of the Federal Reserve, and consumer inflation expectations are rising, despite the fact that the situation on the labor market remains prosperous. At a press conference dedicated to the Fed meeting, Jerome Powell noted the acceleration of real GDP growth in the current quarter. Consumer spending remains steady, but the increase in capital investment is starting to slow down. Along with this, the increase in mortgage rates significantly cools the demand for housing. The day before, statistics were released reflecting a decrease in retail sales in May by 0.3% mom, as inflation and a shortage of supply of some goods, primarily cars, restrain consumer activity. It is likely that the weakening of demand will reduce the pressure of price growth, which will be the reason for a less active tightening of the PREP next year. The Fed is considering a rate cut in 2024.The regulator has raised the inflation forecast for the personal consumer spending Price index (PCE) for the current year from 4.3% to 5.2%, taking into account the rise in the cost of energy and food under the influence of geopolitical factors. The benchmark for the dynamics of US GDP for 2022 assumes its growth by 1.7% against the previous forecast of 2.8%. Unemployment is expected to reach 3.7% at the current 3.6%, next year the indicator may rise to 3.9%.The stock exchanges of the Asia-Pacific region ended trading on June 16 in different directions. Japan's Nikkei gained 0.40%, Hong Kong's Hang Seng dropped 2.57%, China's CSI 300 lost 0.66%. EuroStoxx 50 has been losing 1.80% since the opening of the session.Brent crude futures are trading at $119 per barrel. The price of gold is $1,834 per troy ounce.In our opinion, the S&P 500 will hold the upcoming session in the range of 3710-3800 points.MacrostatisticsData on the real estate market for May will be published today. The number of construction permits is projected to decrease to 1.78 million with a reduction in the volume of construction started from April's 1.724 million to 1.7 million.Sentiment IndexThe sentiment index lost two points, dropping to 29.Technical pictureThe S&P 500 showed a recovery of quotations after five sessions that ended in negative territory. The RSI remains near the oversold level, which indicates the likelihood of a short-term rebound. MACD does not signal the approach of a reversal, while morning futures suggest a further decline in quotations. The nearest resistance for the broad market index may be located at around 3900 points, and the range of 3660-3700 points will serve as support.ReportsAdobe (ADBE) will present quarterly results this Thursday. The consensus forecast assumes that the revenue of one of the leading representatives of the IT sector will reach $4.3 billion (+13.2% YoY) with EPS at $3.3 (+8.9% YoY). Adobe's competitor in the segment of marketing and e-commerce technologies Salesforce.com (CRM) aims to boost business development by expanding the product line, while strengthening the main software direction. In March, management presented a weak quarterly forecast based on the assumption that increased competition is damaging the design software segment. According to Adobe Chief Executive Officer Shantanu Narayen, for the first time since 2017, the company will have to significantly change the prices of its most popular products. It is expected that this will affect earnings in the second half of the fiscal year. ADBE shares have lost 30% since the beginning of ...

About the companyAdobe (ADBE) is the world's largest developer of software for creating various media content, including documents, video files, web page layout, creating content for video games, movies, clips, and others. The company's main products are Photoshop, Illustrator, InDesign, and After Effects. Adobe's key operating segments are digital multimedia solutions – 73% of revenue, solutions for online marketing and digital commerce - 27%. From a geographical point of view, the company's sales are distributed as follows: North and South America – 58.2%, Europe and the Middle East – 26.6%, Asia – 15.1%.Investment attractiveness factors1. One of the key medium-term investment advantages is Adobe's position in the industry. Thus, in the segment of solutions for processing photo and video files, according to various open data, Adobe products occupy 55-70% of the entire market, and in a number of product niches Adobe solutions as a whole have no quality analogues. A very high value proposition allows you to maintain the price strength of the company, which translates into a high marginality of operations. The growth of business digitalization, expansion of functionality, AI functionality, as well as the spread of 5G will stimulate the growth of demand for content creation solutions – Deutsche Bank Securities estimates the CAGR of the creative segment at 15% in the future until 2025. The total size of the target market for content creation software will grow, according to Adobe estimates, to $63 billion by 2024. Moreover, the issuer estimates the expansion of the target market by 54% in 2024 compared to 2023. According to management's forecast, in 2022 the target market in the Creative Cloud segment should be about $31 billion.2. In the segment of cloud documents and digital signatures (about 30% of the market), the company also demonstrates strong demand dynamics against the background of the development of mobile and web versions of products. According to the findings of Bloomberg Intelligence, the company's target market will grow by 2023 almost four times compared to 2020. According to the results of the last quarterly report, the number of Acrobat Web users increased by 100% YoY, the number of signatures using Adobe Sign increased by 87% YoY.3. According to open data, the combined share of Adobe Marketing and Marketo products puts the issuer in the first position in the segment. Despite Magento's weaker position compared to market leaders (Shopify, WooCommerce), a recent Gartner report identifies Adobe as one of the leaders in digital commerce solutions, due to its broad analytical functionality, depth of solutions and integration capabilities. IDC estimates the growth potential of solutions for online commerce at the level of 20% in the future until 2025.4. Adobe maintains a strong growth momentum in the relatively young market segment of 3D solutions with the Adobe Substance 3D Collection product line. We believe that the development of the segment will contribute to the growth of both gaming and professional solutions. A potential trigger for growth is the development of the VR& AR market – according to a study by The Business Research Company, the CAGR of the market for software solutions for VR&AR in the future until 2025 will be 45%, the market size will reach $13.1 billion.5. We believe that the negative reaction of the market to the latest quarterly report is excessive and creates a good point for opening positions. Adobe's revenue growth rate for the fourth quarter was 20%, which exceeded the market consensus forecast by 0.5% and by 1% – the initial forecast of management. Non-GAAP diluted EPS increased by 13.9% to $3.2, which is 0.5% higher than the management forecast, but coincided with market estimates. We believe that the normalization of growth rates is an expected phenomenon after increased growth in 2021. Management announced an increase in R&D expenses last quarter, so we believe that the market, accustomed to strong results from Adobe, expected more, which caused a correction. At the same time, demand remains strong, the amount of obligations to be fulfilled (RPO) increased by 23% (1 percentage point higher than last quarter). In the conditions of correction of quotations to the levels of five-year average multipliers for P/E, we believe that investors have the opportunity to successfully open a long position.ConclusionThe target price for the company is ...

Adobe (ADBE) is the world's largest developer of software for creating various media content, including documents, video files, web page layout, graphics for video games, movies, clips, etc. The most popular products of the company are Photoshop, Illustrator, InDesign, After Effects. The issuer's key operating segments are digital multimedia solutions (73% of revenue), as well as products for online marketing and digital commerce (27% of revenue). From a geographical point of view, the company's sales are distributed as follows: North and South America account for 58.2%, Europe and the Middle East 26.6%, Asia 15.1%.Key investment theses:Among the medium-term investment advantages of the issuer, we highlight Adobe's strong position in the industry. Thus, in the segment of solutions for processing photo and video files, according to open sources, the company's solutions account for 55-70% of the market, and in a number of product niches Adobe software has no quality analogues. A very high value proposition allows you to maintain the price strength of the company, which translates into a high marginality of operations. The growth of business digitalization, the expansion of functionality, the development of the AI segment, as well as the spread of 5G networks will stimulate increased demand for content creation solutions. Thus, Deutsche Bank Securities estimates the CAGR of the creative segment at 15% in the future until 2025. The total volume of the target market for content creation software will expand, according to Adobe forecasts, to $63 billion by 2024, with an increase of a solid 54% compared to 2023. Separately, we note the Creative Cloud segment: according to the forecast of the issuer's management, in 2022 the volume of the target market in this direction will be about $31 billion.In the segment of cloud documents and digital signatures (about 30% of the market), the company also demonstrates strong demand dynamics against the background of the development of mobile and web versions of products. According to the findings of Bloomberg Intelligence, the company's target market will grow by 2023 almost four times compared to 2020. According to the latest quarterly report, the number of Acrobat Web users increased by 100% YoY, the number of signatures using Adobe Sign increased by 87% YoY.According to data from open sources, the combined share of Adobe Marketing and Marketo products allows the issuer to maintain leading positions in the segment. Although Magento (an e-commerce platform acquired by Adobe in 2018) is inferior in market share to comparable organizations (Shopify, WooCommerce), in a recent Gartner report Adobe was named one of the leaders in the segment of e-commerce solutions, due to the broad analytical functionality, depth of solutions and integration capabilities of the company's products. In the future, until 2025, according to IDC estimates, this area of Adobe's business can expand by 20%.The developer maintains a strong growth momentum in the relatively new market segment of 3D solutions with the Adobe Substance 3D Collection product line. We believe that the development of the direction will contribute to the improvement of the company's position both in the gaming and professional solutions sector. The development of VR&AR contributes to the growth of the direction: according to a study by The Business Research Company, the CAGR of the market for VR& AR solutions in the future until 2025 will be 45%, the volume of the target market will reach $ 13.1 billion.In our opinion, the negative reaction of investors to the company's latest quarterly report was excessive. Adobe's revenue growth rates for October-December 2021 amounted to 20%, exceeding the consensus and the initial forecast of management by 0.5% and 1%, respectively. Non-GAAP diluted EPS increased by 13.9% to $3.2, coinciding with market estimates and exceeding management expectations by 0.5%. We believe that the normalization of growth rates was expected against the background of a high base in 2021. Management announced an increase in R&D expenses last quarter, so we believe that investors accustomed to strong results from Adobe simply expected more from the company. At the same time, the demand for the issuer's products remains strong, and the amount of obligations to be fulfilled (RPO) increased by 23% (+1 percentage point QoQ). Taking into account the correction of ADBE quotes to the levels of five-year average multipliers for P/E, we believe that good conditions have now been created for entering a long position.From the point of view of technical analysis, the situation is also in favor of the bulls: the RSI oscillator is currently in the oversold zone (at the level of 27.07), which indicates a likely rebound in quotes.The target price for ADBE paper is $618.5 per share. The recommendation is ...

Adobe (ADBE) ambiguously reported for the fourth quarter, and its forecasts for the next period were weaker than market-wide expectations.Adobe's revenue increased by 20% compared to 22% in the third quarter. This rate was 0.5% higher than consensus and 1% higher than its own initial forecasts. Diluted non-GAAP EPS grew by 13.9%, reaching $3.2. The dynamics of this indicator was 0.5% ahead of Adobe management forecasts, but coincided with consensus. The volume of obligations to be fulfilled (RPO) increased by 23%, which is 1 percentage point higher than the result of the last quarter.Revenue from Digital Media grew by 21%, slowing by 2% compared to the previous quarter. Segment ARR increased by 4.9% (Q3: +4%). Creative Revenue generated 19% more revenue than a year earlier, supported by revenue from Substance, which increased by 100% YoY due to strong demand for 3D solutions and mobile products (+55%). Among the positive drivers for Adobe's revenue, we note the appearance of the Creative Cloud Express product (it offers thousands of templates and instant photo processing for non-professionals) and the offer of Photoshop and Illustrator online programs.Document Cloud revenue growth was 29% on the back of strong demand for Acrobat Online. The number of Acrobat Web users increased by 100%, the number of signatures using Adobe Sign increased by 87% YoY. The segment's ARR added 31%.Revenues from the marketing and analytics segment (Experience Cloud) increased by 23%, and the volume of orders increased by 50% YoY. The recently announced Adobe Journey Optimizer platform, which contains information about the client with an API for external databases, should provide new growth drivers in this direction.Adobe's margin increased by a modest 0.3 percentage points in the reporting period, which was generally expected. Next year, the pressure on profitability, according to the CEO of the company, will be exerted by the normalization of part of the expenses that the issuer refused earlier, as well as the growth of R& D costs.The management's updated annual forecast assumes Adobe revenue growth of 13.4% with a market-wide estimate of 14.65%. Non-GAAP EPS management lays at $13.7 versus consensus of $14.2. It should be noted that Adobe retains the growth potential in all key niches of the Creative Cloud direction by betting on solutions for collaboration with video files Frame.io and the development of products for amateurs (Creative Cloud Express).We evaluate Adobe's results neutrally. The demand for its products continues to grow actively, including due to the development in related and promising niches. We believe that the normalization of growth rates is quite natural after the acceleration in 2021. The management announced plans to increase R&D expenses last quarter, so we consider the negative reaction of the market to the release somewhat excessive. We believe that turbulence may put pressure on Adobe's quotes in the short term, but in the medium term the company remains attractive for investment.We are raising the target price for Adobe stock to $618. The recommendation is ...

The market the day beforeTrading on December 10 on American stock exchanges ended in positive territory. The S&P 500 rose 0.95% to 4,712 points, the Nasdaq added 0.72%, and the Dow Jones increased 0.6%. All sectors of the S&P 500 showed positive dynamics. The growth leaders were issuers from the IT industry (+2.07%) due to the strong performance of companies providing cloud services, and manufacturers of non-cyclical consumer goods (+2%) against the background of a confident Costco (COST) report.Company newsOracle's quarterly results (ORCL: +15.6%) indicated accelerated license revenue growth and strong dynamics of the cloud services segment. The company also announced a $10 billion buy back program.Costco Wholesale (COST: +6.6% COST) reported above EPS expectations. Sales exceeded the pre-pandemic level, revenue growth was due to an increase in membership fees. The company is successfully coping with the pressure of inflation on margins.Phase I trials of the Moderna vaccine (MRNA: -5.6%) against seasonal influenza did not demonstrate a higher efficacy of the drug compared to the developments of competitors.ExpectationsToday, global stock markets are showing mixed dynamics. Investors are still closely following the news about the spread of a new strain of omicron. It has already been reported that this variant of the coronavirus can displace the delta mutation and take a dominant position in some regions within a few days. The UK has raised the alert level for the incidence of COVID-19 from three to four, indicating a threat to the health system. New restrictions have been introduced in the country, vaccination with booster vaccinations is being stimulated. At the same time, additional studies confirm that the disease caused by the omicron variant proceeds in a mild form. The number of hospitalizations in South Africa remains at the level of previous waves of infections, which somewhat encourages market participants.The upcoming FOMC meeting also remains in the focus of investors' attention. Published on Friday, the annual CPI in the US for November was 0.8% on a monthly basis (consensus: 0.7%) and 6.8% on an annualized basis (consensus: 6.7%). This is the highest inflation rate since June 1982. This report reinforces the Fed's arguments in favor of accelerating the pace of reduction of the quantitative easing program. It is possible that such a decision will be made already at the December FOMC meeting. In this case, the market's confidence that the first increase in the key rate will take place earlier than scheduled will strengthen.Asian trading platforms ended the trading session mainly in the green zone. Japan's Nikkei gained 0.71%, China's CSI 300 rose 0.57%, and Hong Kong's Hang Seng sank 0.17%. EuroStoxx 50 has been rising 0.79% since the opening of trading.Risk appetite is moderate. Brent crude futures rise to $75.2 per barrel. Gold is strengthening to $1,787 per troy ounce.In our opinion, the S&P 500 will hold the upcoming session in the range of 4690-4740 points.MacroeconomicsNo significant macro statistics are expected to be published today.Technical pictureThe S&P 500 index continues to move towards the upper boundary of the ascending channel, holding near the historical maximum. The RSI indicator indicates the continuation of the upward trend, and the MACD gave a signal for a reversal in the direction of growth and the interception of the initiative by the bulls. The nearest support is located near the 50-day moving average.In sightOn December 15, the construction company Lennar Corporation (LEN) will present its quarterly report. The consensus forecast assumes that revenue will be $8.506 billion (+24.6% YoY) with EPS of $4.15 (+47.2% YoY). The issuer is the second largest construction company in the United States by revenue after D.R. Horton, Inc., whose report for the 3rd quarter beat market expectations amid continuing high real estate prices and strong demand. Taking into account the current industry situation, investors expect positive financial results of the issuer.On December 16, Adobe (ADBE), the world's largest developer of software for creating digital content, will report for the 4th fiscal quarter. According to the consensus forecast of Factset, according to the results of the 3rd fiscal quarter, the company's revenue will grow by 19.4%, to $4.08 billion (0.4 percentage points higher than the initial forecast of management), and adjusted diluted EPS - by 13.88%, to $3.2, which corresponds to the initial estimate of management. Of particular interest to market participants is the annual and quarterly dynamics of sales growth: after several quarters of continuous improvement in financial metrics, the movement of quotations will be determined by the dynamics of demand and business growth forecasts. Also, investors will expect the guidelines for the Adobe Sign sub-segment: for example, the quotes of the competitor DocuSign collapsed by almost 30% after the release of a weak forecast. Estimates of future margin dynamics can also be attributed to key aspects of the upcoming report: the growth of R&D expenses in the current quarter did not have a negative impact on the indicators, however, an increase in the forecast for operating expenses for the whole of next year may lead to increased uncertainty about Adobe's financial results in the coming periods.On December 16, the quarterly report will also be published by the transport company FedEx Corporation (FDX). The consensus forecast assumes that its revenue will be $22.414 billion (+8.8% YoY), and EPS will reach $4.27 (-11.6% YoY). The issuer is one of the leaders in the transport and logistics sector, but at the moment the company is experiencing problems with hiring employees and expanding its staff. Nevertheless, FedEx is actively working to solve this problem: in early December, it became known that the wages of employees will be raised by more than 9% over the next three years. This measure can increase the attractiveness of the company as an ...

The market on the eveAt the auction on September 17, American stock markets showed negative dynamics. The S&P 500 index fell by 0.91%, to 4432 points. The Dow Jones adjusted by 0.48%, and the Nasdaq fell by 0.91%. Healthcare companies showed a slight increase (+0.07), and the cyclical consumer goods sector registered the smallest drop (-0.38%). The outsiders were utility companies (-1.59%) and the materials sector (-2.06%).Company newsMedical technology company Thermo Fisher Scientific (TMO: +6.5%) raised revenue expectations for 2022 amid an increase in testing for COVID-19.The quotes of the investment management company Invesco (IVZ: +5.5%) rose on the news of a possible merger with State Street Corp.Shares of steel producer Cleveland-Cliffs (CLF: -5.2%) continued to decline ahead of the quarterly report, which investors are pessimistic about.ExpectationsAccording to the expectations of the investment community, at the upcoming FOMC meeting on Wednesday, Fed officials will more clearly outline plans for the timing of the beginning of the curtailment of QE. A little earlier, the regulator already indicated that the intermediate target for inflation has already been reached, and employment indicators continue to recover. Market players believe that the official rate cut will be announced in November, and this issue will be actively discussed at the September meeting.There has also been a sharp increase in energy prices recently: natural gas futures in the United States this month have risen by at least 17% and about twice as much as in March. A steady rise in prices will be felt in all industries and households, raising fears that increased material costs will persist and put pressure on consumption and production. The cost of gas is spurred by several factors at once. In the United States, this is the suspension of drilling operations and adverse weather conditions, and in Europe — the depletion of reserves, which led to increased demand for energy carriers and a lack of generating capacity in the wind energy sector.Against the background of the absence of obvious drivers for the growth of the broad market index, we expect today a neutral negative dynamics of the S&P 500, which corresponds to the trend of last week.Asian stock markets showed mixed dynamics. Hong Kong's Hang Seng fell by 3.30%, China's CSI 300 increased by 1%, Japan's Nikkei 225 added 0.58%. EuroStoxx 50 loses 2.24%.The risk appetite is moderate. The yield of 10-year treasuries is reduced to 1.34%. Brent crude futures are trading at $74 per barrel. Gold rises to $1,754 per troy ounce.In our opinion, the S&P 500 will hold the upcoming session in the range of 4380-4450 points.MacrostatisticsThe publication of significant macrostatistics is not planned for today.Technical pictureThe S&P 500 broad market index continued to decline for the second week in a row, reaching just above 4430 points. 4370 points still serves as an important reversal level, the breakdown of which can be the beginning of a movement to the next support level in the area of 4230 points. Nevertheless, the trajectory of the movement can still return to the range of the uptrend, the upper limit of which reaches the level of 4600 points.In the field of viewOn September 21, the world's largest developer of software for creating digital content, Adobe (ADBE), will present its financial results for the third quarter. According to Factset's forecast, by the end of the third quarter, revenue will grow by 20.6% to $3.84 billion, non-GAAP EPS - by 17.1% to $3.01. We expect that the company can exceed market expectations for sales growth due to the continued strong momentum of demand for cloud solutions, as well as against the background of positive dynamics in the segment of online advertising and online marketing. In our opinion, thanks to Adobe's exceptional position in the digital content creation software segment, the company will maintain stable double-digit sales dynamics in the medium term.The focus of market participants will be on the company's operating margin: previously, management predicted an increase in investments in R&D, sales and marketing. We also expect details of the issuer's development in the relatively new 3D and AR niches. In addition, in all likelihood, the management will present the details of the development of Workfront within the company.On September 23, investors are looking forward to the Nike (NYSE: NKE) earnings report. The footwear and clothing giant showed impressive growth in the previous quarter, and since then, comments from competitors such as Lululemon Athletica and Foot Locker have only increased enthusiasm in the industry.In particular, the sports brand Lululemon recently reported an unexpected acceleration in growth at the beginning of the summer, and Foot Locker said that there is no slowdown in demand for sneakers and clothing yet. Nike also recently increased marketing spending to $1 billion thanks to the resumption of live sports broadcasts. All these factors help explain why most investors expect new record sales from Nike this week. It is already known that revenue growth reached $12.5 billion compared to $10.6 billion a year ago.The main threat to this positive outlook, in addition to the economic downturn, is problems with stocks and supply chains. Nike will have to compete with other retailers who are looking for logistics capacity to fill their distribution network ahead of the holiday ...

Adobe quotes continue to move within the framework of strong growth and a bullish channel. Moving averages indicate the presence of a short-term bullish trend for ADBE. Prices have broken up the area between the signal lines, which indicates pressure from buyers of securities. At the time of publication of the forecast, the price of Adobe shares is 605.19. Within the framework of the forecast of the ADBE share price, we should expect an attempt to develop a correction and a test of the support level near the area of 550.55. Next, a rebound up and a continuation of the rise in the value of securities. The potential target of such a movement is the area above the level of 700.00.An additional signal in favor of the rise of ADBE quotes will be a test of the trend line on the relative strength indicator (RSI), as we can see, now the values are testing the resistance line, there are chances to go into correction. The second signal will be a rebound from the lower border of the bullish channel. The cancellation of the option for the growth of the Adobe stock price quotes will be a fall and a breakdown of the 525.05 level. This will indicate a breakdown of the support area, as well as the lower border of the channel and the continuation of the fall to the area at the level of 485.05. We should expect an acceleration of the stock's rise with a breakdown of the resistance area and a close above the level of 625.05.Adobe shares forecast for July and August 2021Thus, the Adobe Stock forecast for July and August 2021 suggests the development of a correction and a test of the support area near the level of 550.55. From where we should expect a rebound and an attempt to continue the rise of the stock to the area above the level of 700.00. The trend line test on the relative strength indicator will be in favor of the growth of securities. The cancellation of the ADBE rise option will be a fall and a breakdown of the 525.05 level. This will indicate a breakdown of support and a continuation of the fall in the value to the area below the level of 485.05. As you can see, the technical analysis of Adobe shares indicates a high probability of a correction from the current levels, but conservative purchases can be considered from the lower border of the ...

Adobe shares are trading 30% above the marks of the beginning of 2021. In the current situation, investors prefer to reduce positions on companies with small capitalization and consider the securities of large players like Adobe as a safe haven. Such attention to the developer is quite understandable: his brands (Photoshop, Acrobat, Lightroom, etc.) are known to many, while, despite his long presence on the market, he not only did not reduce his share under the influx of young competitors, but was able to increase it. However, after such a strong growth in quotations, during which Adobe was able to bypass Salesforce by market capitalization, there was almost no room for further movement.The bulk of Adobe products have long been installed by default by users, whereas the main driver of growth recently has been Document Cloud, a service for working with digital signatures. While other services have grown by about 20% per year, Document Cloud has grown by more than 30%. In three years, the number of users of the product has grown 10 times, and by the end of the last quarter, the ARR indicator reached $1.79 billion. It is unlikely that the direction will be able to maintain such a high pace, given such a large figure. And all future success is already clearly included in the current prices.Operating margin increased by 250 basis points and reached 46%. However, in the next quarters, management expects more modest results or even a decrease in the indicator due to "post-coronavirus ...

For several decades, Adobe remained an important player in the software market. If you need to edit an image, develop a mobile app, create graphics for social networks, or add effects to a video, then you need the products of this company.Over the past 5 years, Adobe's stock has seen explosive growth, overtaking Facebook, Amazon, and Zacks Technology. However, since September 2020, the paper has held at a strong level, which for a long time could not break through, and only now there has been a shift.ADBE is one of the first major companies to report earnings for the second quarter of 2021. Let's see how the software developer completes the first quarter and whether this document deserves the attention of investors.The company has created a number of tools that are very popular among designers, creatives, and anyone who needs to process text, video, and images.Adobe went public in the mid-1980s. Having created a number of important programs, the software developer became popular, but the transition to the SaaS subscription system helped him win the global market.The company's subscription-based business model allows it to grow steadily, and cloud computing software is actively used by various businesses, schools, design studios, etc.Adobe has three cloud computing divisions. The biggest Creative Cloud is software for creative professionals, such as Photoshop and Illustrator. Adobe has expanded its business to include services such as electronic signature, marketing, and others. This is done by the Document Cloud division: Acrobat and e-signature offerings. In December 2020, the company completed the purchase of Workfront, a leading platform for marketers.The third cloud department, Experience Cloud (marketing programs and services), is responsible for this segment. Business diversification and unique solutions help the issuer to maintain a strong position in the SaaS market, which is full of similar offers. The emphasis on signature and unique software makes the company an attractive investment target.The company's return on equity is an incredible 300%. Bottom line: For every dollar spent on running this business, the issuer gets almost $3 in operating profit.Financial aspectAccording to the reports, in 2020, the company's revenue increased by 15% compared to the same period last year, and sales - by 26%. The largest number of sales was received in the Creative Cloud, Document Cloud, and Experience Cloud industries.Adobe Creative Cloud revenue rose 31% to $2.4 billion in the first quarter. The figure itself is impressive, and it also shows that the company's growth accelerated by 22%.Earnings growth in the first quarter ended March 5 forced the company to raise its annual targets for 2021. Earnings per share for the period increased by 38%, with the indicator growing for the second quarter in a row. In the three quarters, revenue grew 14% and sales grew 26%.In the first quarter of 2021, cash flow is also expected to increase by 39% to $1.71 billion, which will be more active growth than sales growth. This pace is expected to continue until the end of 2021.Read more: EPS: about Earnings per Share with examples in simple wordsBuy or sell paper?Adobe According to Zacks, second-quarter sales are expected to grow 19% and adjusted earnings are expected to grow 15%.This dynamic allows the company's shares to grow in price. The upward trend will be supported by a resurgence in both the US and the global economy.Adobe has coped well with the pandemic thanks to the increased demand for digital technologies. However, it would be a mistake to assume that the growth of the issuer's shares over the past 12 months is only related to the pandemic. It would be more accurate to say that the pandemic accelerated the already excellent growth rate of this company. It is clear that Adobe has become an important component of the global software market, and this will not change after the defeat of the coronavirus.While the start to the fiscal year is impressive, the stock has been in this range for a long time and is only now showing a shift in the market.At the same time, the company can not be called overpriced, and the long apartment was rather a small respite before a new growth cycle.The shares of the software manufacturer look very attractive. Like other companies in the industry, Adobe can expand its business. After spending on the development and implementation of the software, the revenue from its use is directed to the net profit, as well as to further development.We have already written that the newspaper has reached a strong level, which it has repeatedly tried to break through since September 2020. And only in June 2021, it was possible. After another assault on the level of $520, the price first rolled back to the level of $470, which this time was used as a springboard for growth. Adobe shares successfully broke through the $520 level and quickly rose to the $540 level. After breaking through the strong resistance zone, we expect the price to move up to the $600 ...