Adobe Systems (ADBE) Scales New 52-Week High Of $99.70

Shares of Adobe Systems Inc. (NASDAQ:ADBE) hit a new 52-week high of $99.70 on May 24, eventually closing at $99.63. The company returned 25.5% in the past one year and has added approximately 6.1% year to date. Average volume of shares traded over the last three months was roughly 2,964K.

What is Driving Adobe Systems?

One of the largest software companies in the world, Adobe Systems’ massive customer base provides it with a distinct competitive edge. We believe that the company is being driven by continuous innovation in its Creative Cloud and Marketing Cloud businesses.

After its successful transition from traditional license to subscription-based services, Adobe now wants to make a place in cloud-related software in areas like documents and marketing. The consistent adoption of the Adobe marketing cloud could serve as a potential catalyst going forward. Moreover, Adobe’s continuous market expansion into new segments is bringing in new users.

As Adobe is focused to shift all its products fully to Cloud, the software developer recently appointed Cynthia Stoddard to take up responsibilities as its senior vice president and chief information officer, effective June 13. Stoddard will help in the further development of the company’s cloud platform business.

In fiscal first quarter, results of which were reported on Mar 17, Adobe’s earnings of 52 cents per share beat the Zacks Consensus Estimate of 47 cents. The growth came on the back of strong adoption of cloud that led to record Creative and Marketing Cloud revenues and better-than-expected Digital Media ARR (Annualized Recurring Revenue) growth. Also, Adobe’s revenues jumped 5.9% sequentially and 24.7% year over year to $1.38 billion and were above the Zacks Consensus Estimate of $1.325 billion.

Additionally, Adobe Systems delivered an average positive earnings surprise of nearly 9.05% over the trailing four quarters. The company’s solid market position, its compelling product lines, strong revenue growth, continued innovation and strong long-term growth potential position it favorably.

The company expects to report fiscal second-quarter results on Jun 21.

For the upcoming quarter, the company projects revenues within $1.365–$1.415 billion and non-GAAP earnings per share in the range of 64 cents to 70 cents. Analysts polled by Zacks predict earnings of 52 cents.

For fiscal 2016, Adobe projects revenues of $5.8 billion and non-GAAP earnings of $2.80 per share. Analysts polled by Zacks expect earnings of $2.21.

Adobe Systems currently has a Zacks Rank #3 (Hold).

Stocks to Consider

Some well-placed stocks in the same space are CommVault Systems, Inc. (NASDAQ:CVLT) , Konami Holdings Corporation (OTC:KNMCY) and Manhattan Associates, Inc. (NASDAQ:MANH) , each sporting a Zacks Rank #1 (Strong Buy).

ADOBE SYSTEMS (ADBE): Free Stock Analysis Report

COMMVAULT SYSTM (CVLT): Free Stock Analysis Report

MANHATTAN ASOC (MANH): Free Stock Analysis Report

KONAMI CORP-ADR (KNMCY): Free Stock Analysis Report

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