Street Applauds Adobe Systems
Shares of Adobe Systems (ADBE) jumped as much as 13% on Friday after the company's latest earnings report reassured investors about the state of its business ahead of an ambitious product-launch schedule.
The company expects to release key products -- such as its Acrobat document creation programs and its suite of software for creative professionals -- on time over the next nine months. While Adobe does expect sales of its flagship creative suite to tail off before the launch of the new version next spring, its latest results indicate that demand for the product is still solid. And Adobe's outlook suggests that the company expects other new products to make up for any sales slack in coming months.
"The bottom line is Adobe's end markets are healthy," wrote Piper Jaffray analyst Gene Munster in a report released Friday. Its underlying health "appears to be providing a soft landing for [the new creative suite] ahead of the highly anticipated launch of [the next version]," added Munster, whose firm has done noninvestment banking business for Adobe in the last year.
Munster reiterated his outperform rating and $45 price target on Adobe's stock. And he wasn't the only one that was bullish. At least three other analysts reiterated their outperform or buy ratings, and Goldman Sachs upgraded the stock to a buy from a neutral.
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