Added to YB: 2025-11-04
Pitch date: 2025-10-31
ADBE [neutral]
Adobe Inc.
+4.74%
current return
Author Info
Chop Wood, Carry Water is a tech manager and investor searching for value-based investments. Sign up for the newsletter.
Company Info
Adobe Inc. operates as a technology company worldwide. Its Digital Media segment offers products and services that enable individuals, teams, and enterprises to create, publish, and promote content; Document Cloud, a cloud-based document services platform; and Creative Cloud, a subscription service that allows subscribers to use its creative products and applications (apps) integrated with cloud-delivered services across various surfaces and platforms.
Market Cap
$143.6B
Pitch Price
$340.31
Price Target
460.00 (+29%)
Dividend
N/A
EV/EBITDA
14.88
P/E
20.55
EV/Sales
6.05
Sector
Software
Category
value
Is Adobe Inc. Cheap Enough?
ADBE (pass): Market leader in creative/digital experience software trading at 17x P/E vs 30x industry avg, potentially 35% undervalued. FY24: $21.5B rev (+11% YoY), $7.9B FCF, 88.6% gross margins. Strong moat from switching costs & workflow integration but faces AI competition risk & FTC regulatory scrutiny over subscription practices. Failed $20B Figma deal cost $1B breakup fee. Clean balance sheet, $25B buyback program. Could double if sentiment improves but prefers lower entry for margin of safety.
Read full article (5 min)