"Adobe reported solid 4Q14 results ... [and] continues to see solid traction for its products with net adds benefiting from single app purchases. We see ADBE continuing to outperform among our large-cap coverage, with valuation still attractive on a growth-adjusted basis," analysts said.
Additionally, Jefferies raised its price target today on the stock to $90 from $83 and reiterated its "buy" rating, emphasizing that the $800 million cash acquisition of Fotolia is "a tremendous opportunity to capture the approximately $5 billion plus market for stock images by closely coupling with ADBE's market leading creative tools."
This deal "epitomizes the Creative Cloud and opportunities to drive value/ARPU for existing subs and attract new ones," Jefferies said.
Credit Suisse remains "neutral" while raising its price target to $75 from $70, saying "although we are encouraged by the Creative Cloud's ability to effectively increase the annual revenue per user versus the prior perpetual licensing model, we believe much of this enthusiasm is captured in Adobe's current valuation."
"We will monitor Adobe's ability to attract new Creative users, increase Creative Cloud pricing, expand operating margins ahead of expectations, and continue to expand into the digital marketing market," Credit Suisse analysts added.