Adobe Systems (ADBE) Down In Early Morning Trading
Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer.
Trade-Ideas LLC identified
(
) as a pre-market laggard candidate. In addition to specific proprietary factors, Trade-Ideas identified Adobe Systems as such a stock due to the following factors:
- ADBE has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $185.1 million.
- ADBE traded 72,285 shares today in the pre-market hours as of 9:12 AM.
- ADBE is down 5.4% today from yesterday's close.
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More details on ADBE:
Adobe Systems Incorporated operates as a diversified software company worldwide. It operates in three segments: Digital Media, Digital Marketing, and Print and Publishing. ADBE has a PE ratio of 146.4. Currently there are 8 analysts that rate Adobe Systems a buy, no analysts rate it a sell, and 4 rate it a hold.
The average volume for Adobe Systems has been 2.4 million shares per day over the past 30 days. Adobe Systems has a market cap of $38.9 billion and is part of the technology sector and computer software & services industry. The stock has a beta of 1.27 and a short float of 0.7% with 1.30 days to cover. Shares are up 7.7% year-to-date as of the close of trading on Monday.
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Analysis:
rates Adobe Systems as a
. The company's strengths can be seen in multiple areas, such as its increase in net income, revenue growth, largely solid financial position with reasonable debt levels by most measures, good cash flow from operations and solid stock price performance. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.
Highlights from the ratings report include:
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Software industry. The net income increased by 34.9% when compared to the same quarter one year prior, rising from $65.32 million to $88.14 million.
- Despite its growing revenue, the company underperformed as compared with the industry average of 10.3%. Since the same quarter one year prior, revenues slightly increased by 3.0%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- ADBE's debt-to-equity ratio is very low at 0.22 and is currently below that of the industry average, implying that there has been very successful management of debt levels. To add to this, ADBE has a quick ratio of 1.74, which demonstrates the ability of the company to cover short-term liquidity needs.
- Net operating cash flow has increased to $399.75 million or 26.91% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -1.21%.
- Compared to where it was a year ago today, the stock is now trading at a higher level, reflecting both the market's overall trend during that period and the fact that the company's earnings growth has been robust. Looking ahead, the stock's rise over the last year has already helped drive it to a level which is relatively expensive compared to the rest of its industry. We feel, however, that the other strengths this company displays justify these higher price levels.
- You can view the full Adobe Systems Ratings Report.
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