NEW YORK (TheStreet) -- Adobe Systems (ADBE) shares are up 2.97% to $71.78 in after-hours trading on Thursday after the company reported fourth quarter financial results after the closing bell that topped analysts' expectations.
The diversified software company reported fourth quarter earnings of 36 cents per diluted share, 6 cents better than analysts were expecting, on revenue of $1.073 billion that was just shy of analysts' $1.1 billion guidance.
Separately, the company also announced that it entered into a definitive agreement to purchase the privately held royalty-free photo and HD video marketplace Fotolia for approximately $800 million in cash. The company will become a part of Adobe's Creative Cloud software service.
TheStreet Ratings team rates ADOBE SYSTEMS INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:
"We rate ADOBE SYSTEMS INC (ADBE) a HOLD. The primary factors that have impacted our rating are mixed - some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and good cash flow from operations. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and feeble growth in the company's earnings per share."